Financial leverage means using debt to finance business activities in order to increase potential returns to owners. While leverage can improve profits when returns exceed borrowing costs, it also increases financial risk. Higher leverage means the business has a greater obligation to meet interest and repayment commitments.
Funds Flow Statement
A funds flow statement shows how financial resources moved between two balance sheet dates, especially changes in working capital and long-term financing. It is...
Fund Accounting
Fund accounting is a system used mainly by non-profits, governments, and institutions to track resources separately according to purpose or restriction. Instead of focusing...
Functional Currency
Functional currency is the main currency in which a business primarily operates and generates cash flows. It is the currency of the primary economic...
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