Leverage:
It is a very scientific tool in the hand of finance manager. Finance manager employs this tool for making efficient financial structure of company. Financial structure is merely mix of debt and equity and with help of leverage, finance manager acquires fund with effective ratio of equity and debt.
In easy word leverage is power and relationship among two interrelated variables. Such variables might be output, sale, cost and gain. Finance manager computes such leverage by apply formula and then utilizes them for taking decision in favor of company's shareholder. Main purpose of leverage testing is maximize the earning of shareholder and reduces the risk of company.
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Diagrams might be of different types, One-Dimensional Diagrams,Two-Dimensional Diagrams, Three-Dimensional Diagrams, Pictograms, Cartograms or Map Diagrams. Costing data are usually presented by one-dimensional or two-dimensional diagrams.
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The statement of cash flows is a fairly current addition to the annual published financial statements. Companies were only needed to publish a statement of financial position (balance sheet) and an income statement.
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