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Which of the following transactions will lower a company’s financial leverage? a

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Which of the following transactions will lower a company’s financial leverage?

a. A mortgage loan is obtained and the proceeds are used to pay off existing short-term debt.

b. Common stock is sold and the proceeds are used to pay off existing short-term debt.

c. Preferred stock is sold and the proceeds are used to pay off existing short-term debt.

d. Short-term debt is obtained to get the company through a period of negative net income and cash flow.