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It's calculated by dividing a firm's total liabilities by total shareholders' equity. Leverage is the term used to describe a business' use of debt to finance its business activities and asset purchases. When debt is the primary way a company finances its business, it's considered highly leveraged.
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Equity can also be defined as the difference between your business’s assets (what you own) and liabilities (what you owe). A business with healthy (positive) equity is attractive to potential investors , lenders, and buyers. Again, these 15 terms are merely an introduction to business accounting. Liabilities. Cash Method.
SmallBusiness Administration. The best way to move forward is by creating a policy in your organization wherein if the testimonial is received within your business; they should be segregated between employees, shareholders, and investors. You must disclose your connection with the endorser.
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