In the context of financial controls, which of the following best describes leverage?
A) It is the ability to operate at minimum cost.
B) It is the ability to earn revenues greater than costs.
C) It is the ability to earn more in returns than the cost of debt.
D) It is the ability to meet short-term obligations.
E) It is the ability to generate cash to pay bills.

Question

Quizplus · Accepted Answer

In financial controls, leverage refers to the use of debt to increase returns on investment. It is the ability to earn more in returns than the cost of debt.

In the Context of Financial Controls, Which of the Following