Explore the Relationship of Equity to Borrowing Power

42459 Bradner Rd., Northville, MI 48168 d: 248-773-7580 f: 888-548-9213

dgaddis@curtisfunding.com www.curtisfunding.com

Cash $ -

Equipment 50,000.00$

Taxes (3,250.00)$

Commission (4,000.00)$

S&H (750.00)$

Warranty (1,200.00)$

Distributor Prof (16,000.00)$

OEM Prof (3,000.00)$

21,800.00$ 21,800.00$

Assets Liabilities

Equity

Cash $ -

Equipment 50,000.00$

50,000.00$ 50,000.00$

Assets Liabilities

Equity

Cash $ -

Equipment 50,000.00$

50,000.00$ 50,000.00$

Assets Liabilities

Equity

Cash 50,000.00$

50,000.00$

Assets Liabilities

Equity

Assuming you can

borrow 6x your equity, here you can

borrow $300,000 with $50,000 equity.

Can you see the

impact on equity when retained

earnings are used to purchase

equipment?

Equity is squandered due to the impact of

cost and value related factors associated

with the equipment. Borrowing power has

dwindled to $130,800, 1/3 its original power.

Hard-earned cash is moved

into equipment!