Q295
Which of the following is a leverage ratio?
A.
Debt equity ratio
AnswerB.
Current ratio
C.
Quick ratio
D.
Earning power
Answer: Option A
Solution
Answer: Option A
Solution:
Debt equity ratio is a leverage ratio. The debt-to-equity ratio (D/E) is a financial ratio indicating the relative proportion of shareholders' equity and debt used to finance a company's assets. Closely related to leveraging, the ratio is also known as risk, gearing or leverage.