Money owed that must be repaid, usually with interest and on a schedule.
For example, a restaurant carries $230,000 in total debt — a $180,000 equipment loan for its kitchen and a $50,000 operating line of credit — both of which appear as liabilities on its balance sheet and must be repaid with interest according to their schedules.
Why it matters: Used wisely, it accelerates growth without diluting ownership; used recklessly, it suffocates cash flow and forces bankruptcy.
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