how to deal with sale of A/R? affect

MarginofSafety

if A/R is sold,cash in and A/R out both in the left side of B/S,so does it affect financial leverage

giorgio10

Degree of financial leverage= (% Change in EPS)/(% Change in EBIT)

Therefore, selling AR has no effect on Financial Leverage.

comp_sci_kid

neilzuo Wrote:
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> if A/R is sold,cash in and A/R out both in the
> left side of B/S,so does it affect financial
> leverage


suppose it is with recourse.
and a question on textbook reading 26 P361
according to answer,when sale of A/R,both asset and liability are added some amount, so A/E is enlarged.
but I don't know why.