Which of the Following Assumptions Is Embodied in the AFN

question 14

Multiple Choice

Which of the following assumptions is embodied in the AFN formula?

• A) All balance sheet accounts are tied directly to sales.
• B) Accounts payable and accruals are tied directly to sales.
• C) Common stock and long-term debt are tied directly to sales.
• D) Fixed assets, but not current assets, are tied directly to sales.
• E) Last year's total assets were not optimal for last year's sales.

---

Definitions:

Common Bile Duct

Duct formed by the union of the common hepatic and cystic ducts; it empties into the small intestine.

Nutrient Absorption

The process by which the digestive system absorbs essential nutrients from food into the bloodstream.

Ileum

Third portion of the small intestine, extending from the jejunum to the ileocecal opening into the large intestine.

Jejunum

Second portion of the small intestine; located between the duodenum and the ileum.