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True or False?
false/ because the capital earning ratio measure earning share but the ratio that measure range of company depend on external financing is debit ratio.
False , Because Capital gearing ratio shows a relation between shareholder's fund and lender's fund. It does not concentrated only on shareholder portion.
What Capital Gearing Stands for :- Analyzing capital structure means measuring the relationship between the funds provided by common stockholders and the funds provided by those who receive a periodic interest or dividend at a fixed rate.
Crux is :-
Highly geared>>>Less common stockholders’ equity
Low geared>>>More common stockholders’ equity