Written with graceful simplicity, The Big Wave won the Childrenâs Book Award of the Child Study Association of America when it was first released. This ebook features an illustrated biography of Pearl S. Buck including rare images from the authorâs estate. Read on Scribd mobile: iPhone, iPad and Android.
Well, the âadvantageâ of increased financial leverage is a potentially higher return on equity. The disadvantage, on the other hand, is that the business is now riskier as it is financed with more debt (when revenue falls for unexpected reasons, there's now a whole lot of interest that still has to be paid).
As a result, it is usually wise for a corporation to use some debt and leverage. Perhaps this is one of the reasons that leverage is also known as trading on equity. Financial ratios such as debt to equity and debt to total assets are indicators of a corporation's use of leverage. In these ratios debt is the total amount of all liabilities (current and noncurrent).