ASSighment 0 Analysis of FInanclal Statments 4. Debt management ratios Aa Aa Companies have the opportunity to use varying amounts of different sources of financing to acquire their assets, including internal and external sources, and debt (borrowed) and equity funds. which of the following is considered a financially leveraged firm? O A company that uses debt to finance some of its assets O A company that uses only equity to finance its assets Which of the following is true about the leveraging effect? O Interest on debt is a tax deductible expense, which means that it can reduce a firm's taxable income and tax obligation. O Interest on debt can be deducted from pre-tax income, resulting in a greater taxable income and a smaller available operating income. Influenced by a firm's ability to make interest payments and pay back its debt, if all else is equal, creditors would prefer to give loans to companies with debt ratios ayer WIN 30 108 2004-2010 Grade t Naw Save & Continue O Type here to search