Forecast the additional capital that it must raise

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Reference no: EM131597246

A company is forecasting an increase in sales and is using the percent of sales (AFN model) to forecast the additional capital that it must raise. Which of the following conditions would most likely increase the AFN?

a. The company previously thought its fixed assets were being operated at full capacity, but now it learns that it actually has excess capacity.

b. The company increases its dividend payout ratio.

c. The company begins to pay employees monthly rather than weekly.

d. The company’s profit margin increases.

e. The company decides to forego discounts on purchased materials.

Reference no: EM131597246

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