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If a Company Is Highly Leveraged, This Means That It

question 15

True/False

If a company is highly leveraged, this means that it has relatively high risk of not being able to repay its debt.


Definitions:

Audit Report

A formal statement issued by an auditor at the conclusion of an audit process, summarizing their opinion on an entity's financial statements.

Retained Earnings

The portion of net income not distributed as dividends but retained by the company for reinvestment or to pay debt.

Cash Dividend

A payment made by a company out of its profits to its shareholders, usually in the form of cash.

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