Debt Financing
Definition
Raising money by borrowing, to be repaid with interest. It preserves ownership but adds fixed repayment obligations and financial risk if cash flow tightens.
Related Terms in Business Terms
Break-Even Analysis
Calculating the sales level at which total revenue equals total costs, so the business neither profits nor loses. It shows how much must be sold to cover fixed and variable costs.
Gross Receipts
The total amounts a business receives from all sources before subtracting any costs or deductions. Several tax and registration thresholds are measured against gross receipts.
Turnover
The total sales or revenue a business generates over a period. In accounting it can also refer to how quickly assets such as inventory or receivables are used and replaced.
Capital Employed
The total funds a business uses to generate profit, generally equity plus long-term debt, or total assets less current liabilities. It is the base for return on capital employed.
Stop memorising terms — let HelloBooks do the work
AI-assisted bookkeeping that handles invoicing, GST, reconciliations, and reports automatically. Free to start.