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We can use “Section 179” to write off the full $6,000 from the vending machine in the first year. In total, we paid $2,400 in financing. So in your bank account, you have... ($14,400 - $2,400) = $12,000 in profit. But on paper, you have... ($14,400 - $6,000) = $8,400 profit. Now imagine, just before the year ends. You finance 8x more machines for $0 down. That’s $48,000 in expenses on paper. So your LLC makes... ($8,400 profit - $48,000) = $39,600 loss But your bank account... ($12,000 profit -
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