patcat88
join:2002-04-05
Jamaica, NY | shareholders
If you have no shareholders, you don't need profit, just breaking even.  |
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captain456
@gci.com
 from:
GOLFnSUN 
| said by patcat88 :If you have no shareholders, you don't need profit, just breaking even. Are you willing to work for free? I didn't think so, so why would you expect somebody else to? Not only work for free but take on massive amounts of debt just for the ability to work for free? |
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tp0d
yabbazooie
Premium
join:2001-02-13
Carnegie, PA
clubs:
 ·Verizon FIOS
1 edit | How does no profit == work for free?
Profit happens when there is excess money after paying ALL the bills, including your paycheck. Breaking even with no profit still pays employees.
Sprint, being a publicly held company, has shareholders that demand some kind of ROI for their services. Since it was said they weren't losing money, the profit margin just wasnt enough.
damn anon's
-j |
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jc100
join:2002-04-10
2 edits | reply to captain456
Well all start ups are a financial loss. There are few companies that open their doors and hit the ground running into the black. It just takes time to build a customer base, market, etc. However, this company has the right idea. Right now, 150 isn't a lot but if they can expand, then I am sure they can make a good deal of money. If your service is say 40 dollars a month and you can net even 3,000 customers, thats 120,000 a *Month*. Figuring this is a small few man operation, then that isn't bad. Consider maybe 20,000 for taxes. 100,000 left. 4 Employees (20K each salary monthly if all are partners and even split). Then around 20K left for future investments (monthly). It's feasible if they can build their subscriber base anyway. The monthly assumes a constant. |
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S_engineer
join:2007-05-16
Chicago, IL | They need to leave 20k around just in case they need to close. Closing a business is very expensive too! |
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jc100
join:2002-04-10 | That's what bankruptcy and an LLC is for. If you file bankruptcy then they can only settle with what you have left. Furthermore, if you are an LLC, they can only sue the company and not you. Presto. |
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doesnt matter
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check your math, customers pay every month. $1.4 million that sounds much better |
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jc100
join:2002-04-10
1 edit | Well I broke it down on a monthly scale anyway. You can multiple that x 12 ONLY if it's assumed to be a constant. Either way, I think they will do OK.
P.S. I did type year instead of month. OOPS. Corrected. |
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captain456
@gci.com
| reply to tp0d
said by tp0d :How does no profit == work for free? Are you serious? lets keep this simple. You open a business. You are making $100 per month worth of sales and your monthly expenses are exactly $100. You break even. You keep doing this month after month breaking even. You are basically working for free. Why is that hard to comprehend? And if you think it isn't the same when It is an evil corporation or someone else then you clearely don't understand the most basic high school level economics/finance/money/how the world works |
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EPS
join:2008-02-13
Hingham, MA | Expenses include paychecks- you can have "no profits" if paying your salary wipes out your profit margin. |
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captain456
@gci.com
| said by EPS :Expenses include paychecks- you can have "no profits" if paying your salary wipes out your profit margin. Umm you can't pay yourself salary. I'm sorry but you guys are ridiculously uneducated on the subject of business yet you love to throw out your uneducated opinions. If there are no shareholders than you cannot pay yourself a salary, that would be illegal since you cannot enter into a contract with yourself. If you are legally allowed to pay yourself a salary then that means there are shareholders. So your statement is null. |
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EPS
join:2008-02-13
Hingham, MA | It depends on how the corporation is set up, I suppose. And I think the term "shareholder" is being used very loosely here to imply being publicly traded, though I could be wrong. |
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captain456
@gci.com
| said by EPS :It depends on how the corporation is set up, I suppose. And I think the term "shareholder" is being used very loosely here to imply being publicly traded, though I could be wrong. If it's a corporation then theres at least 1 shareholder. And not it does not have to be publically traded. If there are no shareholders than it is not a corporation. |
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tp0d
yabbazooie
Premium
join:2001-02-13
Carnegie, PA
clubs:
·Verizon FIOS
4 edits | reply to captain456
said by captain456 :said by tp0d :How does no profit == work for free? Are you serious? lets keep this simple. You open a business. You are making $100 per month worth of sales and your monthly expenses are exactly $100. You break even. You keep doing this month after month breaking even. You are basically working for free. Why is that hard to comprehend? And if you think it isn't the same when It is an evil corporation or someone else then you clearely don't understand the most basic high school level economics/finance/money/how the world works You're using the wrong definition of 'break even'. Monthly expenses of keeping a business running -include- employees. The president of a 1-man business is -still- an employee. Even a non-profit has to have a payroll, but theyre not allowed to turn a profit. If a business can't be run without its employee or employees making a decent living, much less any profit, its not worth it.
Since when does the president of an LLC (single member even) not pull a paycheck? The article mentions an LLC, not a fullblown corp.
Yes I understand economics, I think you are lacking in some of the principals tho..
-j
--
if it aint broke, tweak it!!
currently on FiOS (kick aZZ!) |
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markopoleo
join:2003-04-02
Bonne Terre, MO | reply to captain456
You must never of worked in your life, most people work for free. If you work from paycheck to paycheck then you are working for free. If you miss one paycheck and are in financial problems it means each paycheck you get.. you are working for free. |
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pooker314
join:2005-04-12
Brush Prairie, WA
| reply to tp0d
Non-profits have "profits" very frequently. If they didn't, they typically wouldn't survive. However, that profit (usually called "operating margin" to avoid confusion), cannot be distributed to the corporation's members (sort of like shareholders). Instead, the money must be used for tax exempt purposes. This usually involves plowing it back into the business somehow (including capital development, higher salaries, etc.).
In the for-profit world, certain smaller corporations (s corps) can get into very big trouble with the IRS if they retain all of their profits for shareholder distributions in lieu of paying their owner/employees a reasonable salary (because shareholder distributions can avoid employment taxes like FICA/FUTA). |
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captain456
@gci.net
| reply to tp0d
Since when does the president of an LLC (single member even) not pull a paycheck? The article mentions an LLC, not a fullblown corp.
That would be called a shareholder. Which then yes they can receive a paycheck. The whole point of this is the origanal poster said something along the lines of if there are no shareholders then there doesn't need to be profit. So let me repeat this simple fact. If there are no shareholders than you cannot apy yourself with a paycheck, that would be illegal. Therefore you would be working for free. |
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captain456
@gci.net
| reply to markopoleo
said by markopoleo :You must never of worked in your life, most people work for free. If you work from paycheck to paycheck then you are working for free. If you miss one paycheck and are in financial problems it means each paycheck you get.. you are working for free. I really don't know where you are coming from. Just just because you work paycheck to paycheck does not mean you are working for free. That's your own mismanagement of life causing you to work paycheck to paycheck. |
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