Would you purchase equipment with debt? Jackson Russell works as a district sales manager for a large pharmaceutical sales company. Jackson would like to purchase a new high-tech marketing display...

Would you purchase equipment with debt?

Jackson Russell works as a district sales manager for a large pharmaceutical sales company. Jackson would like to purchase a new high-tech marketing display that he will be able to use at upcoming medical conferences. The marketing display will allow his customers to access up-to-date information and research statistics on the pharmaceuticals that his company sells by using multiple touch screen computers. He believes that the marketing display will significantly increase the sales revenue of the products he sells. The only problem is that the marketing display will cost $50,000, and he does not have the cash in his budget to purchase the display. Jackson will need to purchase the display using debt, which will increase the district’s debt ratio from 20% to 58%. Jackson is aware that his company closely monitors the district’s debt ratio and has a policy that the district must maintain a ratio below 55%. Should Jackson purchase the equipment?