Which factors are used to determine the level of sales that a firm can generate without having to raise any external funds (self-supporting growth rate)?
A)profits retained from sales, and assets and liabilities tied to sales
B)total profit from sales, and assets and liabilities tied to sales
C)profits retained from sales, and total assets and liabilities
D)total sales, and total assets and liabilities

Question

Quizplus · Accepted Answer

The self-supporting growth rate is determined by the profits retained from sales (which are essentially the earnings that are not distributed as dividends and are reinvested into the business), and the assets and liabilities that are directly tied to sales (indicating how efficiently a company can grow its sales without needing additional external financing by using its existing operational capabilities and financial structure).

Which Factors Are Used to Determine the Level of Sales