The most wealthy corporation in America carries over $12 BILLION in debt.
But you're laundromat won't be able to add machines and grow, due to your stupidity concerning debt.
You're so full of shit, it's incredible. But not surprising.
""Just recently I (Joe) was facilitating a session with employees from a small business that had been acquired by a larger public company. The small business did not have any debt prior to the merger. During the balance sheet discussion, the previous owner of the small business asked, "Why do we have debt in this new company? I hate debt."
Most of us don't care for debt. We hear about the crushing effect of consumer debt on our economy. So why is debt for a business a good thing?
There are two reasons why a company should use debt to finance a large portion of its business.
First, the government encourages businesses to use debt by allowing them to deduct the interest on the debt from corporate income taxes. With the corporate tax rate at 35%(one of the highest in the world) that deduction is quite enticing. It is not uncommon for a company's cost of debt to be below five percent after considering the tax break associated with interest.
Second, debt is a much cheaper form of financing than equity. It starts with the fact that equity is riskier than debt. Because a company typically has no legal obligation to pay dividends to common shareholders, those shareholders want a certain rate of return. Debt is much less risky for the investor because the firm is legally obligated to pay it. In addition, shareholders (those that provided the equity funding) are the first to lose their investments when a firm goes bankrupt. Finally, much of the return on equity is tied up in stock appreciation, which requires a company to grow revenue, profit and cash flow. An investor typically wants at least a 10% return due to these risks, while debt can usually be found at a lower rate.
Your firm is a figment of your imagination. LOL
You know not of which you speak, nitwit!!
<quoted text>Absolutely concur. Neither my firm nor I carry any debt whatsoever.
I am truly free.