Capital gearing

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The Manager’s Handbook for Understanding Accounts
F. A. J. Couldery
( http://www.infinitybooks.org/)

Check your gearing

An important concept in corporate financing is that of capital gearing, or leverage, writes F. A. J. Couldery in The Manager’s Handbook for Understanding Accounts. Gearing, for starters, is the relationship between the borrowed funds on which interest is paid, and the proprietors’ capital on which dividends are paid.

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