The financial ratio that indicates the degree to which the organization uses debt or equity to finance its ongoing operations is the _____________ ratio.
A) leverage
B) liquidity
C) activity
D) profit
E) inventory turnover

Question

Quizplus · Accepted Answer

Leverage ratios,such as the debt-to-assets ratio and the times-covered ratio,measure the degree to which managers use debt (borrow money)or equity (issue new shares)to finance ongoing operations.

The Financial Ratio That Indicates the Degree to Which the Organization