Leverage Ratios Indicate

question 48

Multiple Choice

Leverage ratios indicate

• A)the relative amount of funds in the business supplied by creditors and 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.

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Definitions:

Annual Interest

The amount of interest payable every year on a loan or investment, typically expressed as a percentage of the principal amount.

High School Graduation

The completion of the required coursework and achievement of necessary credits for a student to officially finish high school and receive a diploma.

Annual Interest Rate

The percentage of principal charged as interest for its use over the span of one year.

Summer Wages

Compensation paid to employees for work performed during the summer season, often applied to temporary or seasonal positions.