A Model to Manage Debt through Equivalent Equations
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Arturo Garcia-Santillan, Carlos Rojas-Kramer, Francisco Venegas-Martinez, Jose Satsumi Lopez-Morales
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Abstract

Companies often face conditions of illiquidity, which leads them to positions of default with creditors and suppliers. This leads to the need for debtors to restructure the debt with its creditors. This article presents a proposal for debt restructuring in a hypothetical scenario by applying equivalent equations. The results show that, under the new payment scheme, the creditor will receive an added profit, and the debtor will get more time to pay, allowing him for better cash flow and working capital management, and for generating best indicators of solvency and liquidity.

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This is an open access article distributed under the Creative Commons Attribution License which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.

Article Type: Research Article

INT ELECT J MATH ED, Volume 12, Issue 2, May 2017, 145-153

https://doi.org/10.29333/iejme/606

Publication date: 08 May 2017

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Article Downloads: 2088

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