Leverage ratios indicate
A)the relative amount of funds in the business supplied by shareholders.
B)a company's ability to pay its short-term debts.
C)management's ability to generate a financial return on sales or investment.
D)a company's profit margins for the last six months.
E)the future profits the company can expect from its current customer base.

Question

Quizplus · Accepted Answer

Leverage ratios measure the extent to which a company is using borrowed money (debt) versus shareholders' equity to finance its assets, indicating the relative amount of funds supplied by shareholders.

Leverage Ratios Indicate