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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: combjelly who wrote (316283)	12/19/2006 2:27:33 AM
From: Elroy	Read Replies (3) \| Respond to of 1573921

"I say as long as the debtor can service the debt, it's not a big deal." What percentage of income is reasonable for debt service? Or to put it another way, at what percentage does it become a big deal? Note: this is to cover only the interest on the debt. Zero dollars are going to retire any of it. I don't think there is an answer for this question because it is about two different issues - liquidity versus profitability. The debt is not threatening to the debtor as long as he can service it (liquidity). However, the debtor also wants to be able to keep as much income as possible (profitability). There is no magic number like "20% of operating income being used to service debt is ideal".