Leverage can impose a financial burden on companies

 

 

Leverage can impose a financial burden on companies. It can also create opportunity costs for the future. For this week’s discussion, compare the long-term debt burden of two publicly traded companies. Select two publicly traded companies from the same industry. Review the long-term liabilities section of the latest annual report for each of the two companies and write a 1-3 paragraph analysis of your findings as your main post. Include a copy of the companies’ balance sheets with your analysis.

 

Sample Solution

Debt is naturally considered a burden. The borrower is liable to pay the interest and principal without default, regardless of the amount of the loan or the interest rate. Sometimes additional burden also appears, like the loan default fee. Inefficient management of multiple loans and resorting to high-interest rate loans intensifies the burden. The debt burden represents an entity’s high debt load and associated debt payment expenses. Its growth paints a troubling picture and highlights how vital it is for responsible authorities to put debt management strategies and regulations in place to lessen the dangerous environment. It could have an impact on the borrowing entity’s liquidity. In the absence of effective and prompt debt services and dependency on several loans, the situation may deteriorate, or the borrower may enter a debt spiral.

In the opening remarks of the World Health Organization’s General-director, use proper words. Most of the expressions used in his statement fit the need of its reader. Few phrases were formal, and some were not, like the phrase, “Today, I have a message for young people: you are not invincible. This virus could put you in hospital for weeks, or even kill you,” is formal for using “I have” instead of making it short like “I’ve.” In addition, in his closing speech, his way of being thankful is too formal. As he stated, “I thank you.” In addition to having a formal structure, WHO’s director uses concrete and concise words in his remarks.

According to him, “Data from many countries clearly show that people under 50 make up a significant proportion of patients requiring hospitalization.” He specified that the adults aged below fifty are the ones in need of care and treatment.

A few downsides included in the statement are the use of technical language or jargon. The main subject of the statement was the regard of the COVID-19, which everyone should have knowledge of. With the use of unfamiliar words, the audience might cause confusion and would not be able to appreciate the message of the statement. In my opinion, they should have used straightforward expressions or words since not everyone has the same vocabulary levels. Especially the topic is for every age some children would find it difficult to understand if the phrase is professional instead of simple. In the middle of the statement, one of the words used is “inevitable,” which is not one of the basic terminologies. In addition, the one mentioned of both using formal and informal structure. In my opinion, he, the WHO’s director, should have used neither formal nor informal rather than using both. Lastly, the use of slang and abbreviations. Most of the phrases have the word “WHO,” which stands for “World Health Organization.” I found this negative since peo

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