Effective debt(redirected from Effective Debts)
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.
The total debt of a company plus the value of its lease payments. Effective debt helps potential investors and lenders determine the ongoing expenses of a company due to debt service and similar costs. If the effective debt rises above a certain level, the company is unlikely to be profitable because of a low net cash flow.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved