How is Joe doing?
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  1. #1
    How is Joe doing?

    Wednesday, September 21, 2005: Joe has a decision to make.
    Originally posted by madeinusa
    Joe has built his company to 3 trucks and needs a shop. Joe also has $100,000.00 in the bank. The shop will cost Joe $75,000.00 for the size he wants to build.

    Does Joe:
    A. Pay cash for the new building
    B. Pay 50% down and mortgage the balance
    C. Pay 25% down and mortgage the balance
    D. Pay 10% down and mortgage the balance

    Which way will be the most "beneficial" to him?
    Sunday, September 25, 2005: Joe decides on the follow course of action.
    Originally posted by madeinusa
    You put down the least amount as possible, and place the rest in a vehicle which earns you a good interest rate. Sometimes this vehicle will earn you more money than the interest on the loan is costing you, therefore the loan would actually be costing you zero on interest.
    Thursday, September 29, 2005: Joe has now removed all of his money from the bank. He puts $7,500 down for a shop and invests the rest. He secures a loan for $67,500.
    Tomorrow is Friday. How will Joe make payroll? Were there enough COD service calls this week to cover this? Next week is a new month. Will accounts receivables come in quick and be enough to cover vendors’ invoices and loan payments on three trucks and a new building? Whoa is Joe.


  2. #2
    I would imagine that Joe needs to have operating expenses before he uses that money to buy a building that he cannot afford, how does Joe pay Joe rent after Joe Builds the building, Can you build the building take on a rent payment and pay it to Joe ? If you can then go ahead and do it. But your employees are expecting you to be liquid at least on payday

  3. #3

    Maybe he is on an every two week payday plan.

  4. #4
    Join Date
    Mar 2004
    Location
    Gone
    Posts
    5,340
    Nevada, it is very apparent you have no conception whatsoever of business finances.

    A business person would obviously keep enough liquid cash to operate his business and invest the rest.

    Go take some business classes, you really need to.

  5. #5

    It took two weeks for you to come up with that? Then your answer to invest the rest was the wrong information. And I understand that you are admitting that a smart person would have inquired as to what other expenses Joe had, how much was owed on the existing trucks, and take into consideration all other variables before making a decision. Then I guess I am on the right track. Imagine that, some people don’t resort to name calling and putting others down to look smart.

  6. #6
    Join Date
    May 2004
    Location
    Rapid City, SD
    Posts
    7,414
    Uhm.... yeah, so what about the beer and strippers? Could get some quality stuff with that much cash.

  7. #7
    Join Date
    Jan 2005
    Location
    steeler nation
    Posts
    2,036
    joe pa wins his first 4 games and his team goes into the top 20

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