Jefferson City Computers Has Developed a Forecasting Model to Estimate

question 21

Multiple Choice

Jefferson City Computers has developed a forecasting model to estimate its AFN for the upcoming year.All else being equal,which of the following factors is most likely to lead to an increase of the additional funds needed (AFN) ?

• A) A sharp increase in its forecasted sales.
• B) A sharp reduction in its forecasted sales.
• C) The company reduces its dividend payout ratio.
• D) The company switches its materials purchases to a supplier that sells on terms of 1/5,net 90,from a supplier whose terms are 3/15,net 35.
• E) The company discovers that it has excess capacity in its fixed assets.

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Definitions:

Objectives Document

A formal and detailed paper outlining the goals and targets of a project or plan, often used in business and strategic planning.

Statement of Scope

A document that outlines the objectives, deliverables, and boundaries of a project, specifying what is included and excluded.

Recommendations

Suggestions or advice offered with the aim of guiding decisions or actions toward a beneficial outcome.

Work Plan

A detailed outline of tasks, activities, and timelines aimed at achieving specific goals or completing a project.