principal payment missing?

[Dan Bell <dbell@kent.edu>]

In David Ellerman's comparision of the ESOP and non-ESOP
loan, he appears to leave out the $200 principal payment
of the non-ESOP company:

Non-ESOP Corporation
EBIT                 $1030
- Interest             -30
Taxable Income       $1000
- Income Tax (50%)    -500
Increase to Equity    $500
Principal payment     -200   This was left out
NET increase to EQ    $300

All of this $300 belongs to the owner of the non-ESOP corporation.

In the ESOP Corporation, there is $400 left to divide among the
original non-ESOP owner and the ESOP. Without knowing the
portion of stock acquired, we cannot compare this $400 and $300.