Introduction to Credit - How \& Why Credit is Used There are a variety of reasons why a management team may wish to use debt in its capital structure. Which of the following statements are true about using debt as a funding source? (select all that apply) Using debt as a funding source (as opposed to equity) will usually improve a companys financial ratios Credit can be structured such that repayment aligns with the cash generated by the underlying assets being financed In general, debtis more expensive than equity but it provides greater flexibility Current assets are usually financed using current liabilities (like operating credit)