Using More Debt Can Increase the Owner's Return on Equity

question 51

True/False

Using more debt can increase the owner's return on equity but it also increases risk.

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Definitions:

Establish Objectives

The process of defining specific, measurable, achievable, relevant, and time-bound goals that an organization or individual aims to achieve.

Internal User

Individuals within an organization, such as management and employees, who use financial information for decision-making purposes.

Creditor

An entity or person to whom money is owed by the business.

Department Manager

An individual responsible for overseeing a specific department's operations, budget, and staff within an organization.