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0. (TCO 6 and 7) Financial leverage deals with: (Points : 7) the relationship of fixed and variable costs. the percentage of debt in the capital

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0. (TCO 6 and 7) Financial leverage deals with: (Points : 7) the relationship of fixed and variable costs. the percentage of debt in the capital structure. the entire income statement. the entire balance sheet. 11. Is there a standard optimum leverage level (debt to equity ratio) that all companies should seek to maintain? Explain your answer. 12. What are the 5 items that are usually taken into consideration in evaluating a company's ability to pay for purchases on credit? Explain each. 1. Character. The customer’s willingness to meet credit obligations. 2. Capacity. The customer’s ability to meet credit obligations out of operating cash flows. 3. Capital. The customer’s financial reserves. 4. Collateral. Assets pledged by the customer for security in case of default. 5. Conditions. General economic conditions in the customer’s line of business.
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Finance- 8100120.doc

0. (TCO 6 and 7) Financial leverage deals with: (Points : 7) the relationship of fixed and variable costs.
the percentage of debt in the capital structure.
the entire income statement.
the entire...

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