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Tems11 [23]
3 years ago
9

The concept of leverage is that a.a high debt-to-equity ratio is favorable. b.it is appropriate to borrow if the return on the a

ssets is greater than the cost of the financing. c.it is appropriate to borrow as long as the lender approves the loan. d.it is unfavorable to borrow funds rather than raise the capital from stockholders.
Business
1 answer:
Travka [436]3 years ago
7 0

Answer:

b. it is appropriate to borrow if the return on the assets is greater than the cost of the financing.

Explanation:

A leverage can be defined as a process which typically involves the use of fixed-charged assets or items in a business with the intention of multiplying potential financial gains and returns.

In Financial accounting, the concept of leverage is that it is appropriate for a business firm to borrow an amount of money (debt), if the return on the assets (capital gain or income) is greater than the cost of the financing (debt or borrowed money).

Basically, financial leverage which is also known as trading on equity, is the utilization of debt (borrowed money) to acquire or purchase new assets with the intent and expectation that the income generated from these assets would exceed the cost incurred from borrowing. Thus, a business that engages in financial leveraging assumes that it would generate a higher income or capital gain from the amount of debt (borrowed money) used in its capital structure.

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________leads to better quality and lower prices?
Nataly [62]

Answer:

a

Explanation:

because it makes sense in the sentence

5 0
3 years ago
6. Assuming the partial billing was approved for payment and the expenditure and liability (contracts payable) was recorded for
jenyasd209 [6]

Answer:

Option A, Credit to Cash, $560,000

Explanation:

As per the data given in the question,

Expenditure and liability = $700,000

Retaining percentage = 20%

Assuming the partial billing was certified for expenses and payments and liability was approved for amount $70,000. Though, Oxford has a policy not to pay 100 percent, but to retain  20 percent as a retained percentage.  

So, $700,000 - $700,000 × 20%

= $700,000 - $140,000

= $560,000

Therefore, The entry to record the approved payment and retained percentage would include:  

Option A, Credit to Cash, $560,000

8 0
3 years ago
Power deriving from one's personal attraction is called ______ power.
Oksanka [162]

The correct answer to the question is (B) referent power.  

Referent power refers to <u>a type of power that a person attains through his or her interpersonal relationship skills</u>.

Though personalized power seems like an answer it is actually not, it is a type of motive that a person has for power. Legitimate, reward, and coercive all stem from external sources, and thus they do not fit the description in the question.

5 0
3 years ago
How auto insurance companies manage risk ?<br>​
Nana76 [90]

____________________________________________________

Answer:

Insurance companies manages risk by balancing the low-risk drivers and the high-risk drivers. Insurance would charge higher rates for high risk drivers.

____________________________________________________

Explanation:

Insurance companies manages risk by sorting out the people who have a lower chance of risking a crash, with people who have a higher chance of risking a crash. They do this by charging low rates to the people that have a lower chance of causing a risk. They charge them low because they are trustworthy, and don't need to rack up a lot of money quick if they ever get into a crash. Remember, insurance makes people pay monthly so they could use that money in a accident.

But, this is different for people with higher risk. People that have a high risk of getting into an accident would be charged with a higher rate than people with lower risk. Insurance companies charge them with higher rates because since higher risk drivers get are more likely to get into an accident, insurance companies want to make sure that they can get the money for the accident as soon as possible. Insurance companies are the ones that pay for the accident, and that's why most places require you to have insurance while you drive.

____________________________________________________

4 0
4 years ago
Read 2 more answers
How does a business's corporate culture affect employee satisfaction? How does a business's corporate culture affect customer sa
oee [108]
<span>A business corporate culture is a set of values, beliefs and policies that guide an organization. It is not limited to the code of ethics and conduct of its management and employees but extend to how this code is being put into practice in the day-to-day operation of the company.

If the corporate culture of the business is positive like there is a clear definition of jobs, goals, and career path, then employee satisfaction will increase. It will create a positive environment where employees give their best in doing their jobs and employee turnover is negligible. 

Having a positive corporate culture will resonate not only to the employees but also to the customers. The company will have a good reputation and will be talked about by satisfied clients. Thus, increasing its customer base and target market.

Having a negative corporate culture will generate the reverse output. Employee satisfaction is nonexistent. Employee turnover is high. Customer satisfaction is down and company reputation is negative. </span>
7 0
3 years ago
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