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Discuss 5 reason comany issue long term debt (500words)

Discuss 5 reason comany issue long term debt (500words)

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Answer #1

1.Debt financing gives you tax benefits, which is not available at equity financing

2 If company issue long term debt then it help in increase the cash flow for the business with sticky revenue nature

3 If we finance our company with long term debt then the lenders of the debt don't going to interfere with your business strategy, it will not the same in case of equity financing, herelender needs board seats and control

4 For long running of business debt is cheaper than equity

5 In a debt financing company Debt saves your time . Lenders don’t need to judge with your every decision, and they don’t require board meetings.

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