The Percentage-Of-Sales Technique Is an Effective Method for a New

question 70

True/False

The percentage-of-sales technique is an effective method for a new company to estimate asset requirements because asset-to-liabilities ratios tend to be relatively constant within an industry.

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Definitions:

New Customer

An individual or entity that purchases products or services from a business for the first time.

Administrative Costs

Expenses related to the general operation of a business, including office management, clerical work, and executive salaries, that do not directly contribute to production or sales.

Sales Organization

A sales organization is the structure of the team within a business that is responsible for selling the company’s products or services, including roles, policies, and strategies to achieve sales goals.

Duplication Of Selling

The strategy of selling the same product or service multiple times or through various channels, often to maximize profit or market penetration.