Alternative Definition Of Financial Leverage
Alternative Definition of Financial Leverage
According to Gitmar, “financial leverage is the ability of a firm to use fixed financial changes to magnify the effects of change in EBIT and EPS”.
FL = EBIT / EPS
Where,
FL = Financial Leverage
EBIT = Earning Before Interest and Tax
EPS = Earning Per share.
According to Gitmar, “financial leverage is the ability of a firm to use fixed financial changes to magnify the effects of change in EBIT and EPS”.
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FL = EBIT / EPS
Where,
FL = Financial Leverage
EBIT = Earning Before Interest and Tax
EPS = Earning Per share.
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