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Which of the following is true of financial leverage? a) It refers to an organizations...

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Accounting

Which of the following is true of financial leverage?

a) It refers to an organizations ability to increase its reported net income by using equity financing.

b) It refers to an organizations ability to increase its reported net income by using debt financing.

c) It refers to an organization's ability to collect receivables faster than paying its dues.

d) A highly leveraged firm means that the company has a high dividend payout ratio.

e) A highly leveraged company means that most of its funds come from retained earnings.

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