When using the percent-of-sales method in forecasting the funds needed, which of the following is not true?
A) Required new funds increase as sales decrease.
B) Required new funds decrease as profit margin increases.
C) Required new funds increase as assets increase.
D) As the tax rate increases, the required new funds increase.

Question

Quizplus · Accepted Answer

The Answer of When using the percent-of-sales method in forecasting the funds needed, which of the following is not true?
A) Required new funds increase as sales decrease.
B) Required new funds decrease as profit margin increases.
C) Required new funds increase as assets increase.
D) As the tax rate increases, the required new funds increase.

When Using the Percent-Of-Sales Method in Forecasting the Funds Needed