Near-north Ontario, French River | I think your math is wrong... You paid 85k for the tractor last year, but whats it worth today? I'm guessing from the bank standpoint 70-75ish?... . If you are able to refinance that at 80% ( I'm not sure the bank would do that on a depreciating asset) ... but lets say you can, that gets you 56-60 to work with. Take off your 35 balance owning and you potentially free up 21-25k not the 45k you figured.
edit
to add further, your plan doesn't really increase your working capital a whole lot , it increases your cash balance. WORKING CAPITAL= CURRENT ASSETS- CURRENT LIABILITIES. So you increase cash but add to current debt ( the current portion of the new loan) and depreciation chugs away
Edited by Thud 9/25/2021 14:20
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