A company begins with the following simple balance sheet: $10 million in real assets; $1 million cash; $5.5 million each in owners’ equity and debt. Which of the following actions will decrease a company’s leverage ratio? Choose two Use half of the cash from the balance sheet to purchase equipment Borrow an additional $1 million and purchase equipment Raise an additional $1 million in equity to purchase equipment Raise an additional $1 million in equity to pay off debt

A company begins with the following simple balance sheet: $10 million in real assets; $1 million cash; $5.5 million each in owners’ equity and debt. Which of the following actions will decrease a...

A company begins with the following simple balance sheet: $10 million in real assets; $1 million cash; $5.5 million each in owners’ equity and debt. Which of the following actions will decrease a company’s leverage ratio? Choose two

		Use half of the cash from the balance sheet to purchase equipment
		Borrow an additional $1 million and purchase equipment
		Raise an additional $1 million in equity to purchase equipment
		Raise an additional $1 million in equity to pay off debt

Jun 09, 2022