Leveraging Implies That a Company

question 18

Multiple Choice

Leveraging implies that a company

• A) contains debt financing.
• B) contains equity financing.
• C) has a high current ratio.
• D) has a high earnings per share.

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Definitions:

Debits

An accounting entry that results in either an increase in assets or a decrease in liabilities or equity on a company's balance sheet.

Credits

Accounting entries that increase liabilities or equity, or decrease assets.

Posting References

Indicators used in accounting to record the transfer of amounts from the journal to the ledger, facilitating the tracking of transactions through the accounting system.

Journal Entry

A record in accounting that documents a transaction in a company's ledger, thereby affecting at least two accounts to keep the accounting equation in balance.