1. More Equity More Power in the Balance Sheet
If any company has low equity share capital than expected fund needed for investment, its balance sheet will become weak. But, if company see this weak-point and issue new shares and gets good response from market. It will increase its cash liquidity. With this, working capital will also increase. Company can use it also for paying short term expenses and buy new equipment for completing the projects.
2. More Repay of Loan More Power in Balance Sheet
Second way of strengthening the balance sheet is to repay all long term loan. Loan is just tension for company. More delay for repayment of loan will surely weak to your balance sheet. If you will become unable to repay, you can face liquidation problem. So, if you got high profit from business and repay all your debt, it will increase the power of your balance sheet.
According to Mark Luden, President of Guitammer
If any company has low equity share capital than expected fund needed for investment, its balance sheet will become weak. But, if company see this weak-point and issue new shares and gets good response from market. It will increase its cash liquidity. With this, working capital will also increase. Company can use it also for paying short term expenses and buy new equipment for completing the projects.
2. More Repay of Loan More Power in Balance Sheet
Second way of strengthening the balance sheet is to repay all long term loan. Loan is just tension for company. More delay for repayment of loan will surely weak to your balance sheet. If you will become unable to repay, you can face liquidation problem. So, if you got high profit from business and repay all your debt, it will increase the power of your balance sheet.
According to Mark Luden, President of Guitammer
"The reduction of debt, increased equity and ensuing improved cash flow, gives us the opportunity to grow our core ButtKicker® brand product business and more importantly, begin to take advantage of the unique opportunities we see for our patented ButtKicker Live®! broadcast technology. The support from our new investors and existing creditors has been very encouraging and continues to validate the strategic path we are on to fundamentally change the world of broadcast sports."
By: http://www.svtuition.org
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