Spontaneous Funds Are Generally Defined as Follows

question 3

Multiple Choice

Spontaneous funds are generally defined as follows:

• A) Assets required per dollar of sales.
• B) A forecasting approach in which the forecasted percentage of sales for each item is held constant.
• C) Funds that a firm must raise externally through short-term or long- term borrowing and/or by selling new common or preferred stock.
• D) Funds that arise out of normal business operations from its suppliers, employees, and the government, and they include immediate increases in accounts payable, accrued wages, and accrued taxes.
• E) The amount of cash raised in a given year minus the amount of cash needed to finance the additional capital expenditures and working capital needed to support the firm's growth.

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Definitions:

Proximity

The physical closeness between people, places, or objects, often influencing interactions and relationships.

Elaboration

The process of adding more information or detail to something, often to clarify or expand upon a concept.

Similarity

The state of being alike or sharing common features, which can influence attraction and group cohesion.

Complementarity

A principle in relationships and systems where different components or participants enhance or complete each other’s qualities or functions.