Which of the Following Would Increase a Firm's Need for Additional

question 35

Multiple Choice

Which of the following would increase a firm's need for additional funds?

• A)an increase in the profit margin
• B)a decrease in the expected sales growth rate
• C)a decrease in assets
• D)an increase in the dividend payout rate

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Definitions:

Zero Profit

A situation where a company's revenue exactly matches its operational costs, resulting in no net profit or loss.

Contribution Margin

The difference between sales revenue and variable costs, indicating the amount available to cover fixed costs and contribute to profits.

Reporting

The process of preparing and presenting data and information, usually financial, to stakeholders to inform them of the organization's status or performance.

Expenses Grouping

The practice of categorizing costs and expenses into distinct groups to simplify financial analysis and reporting.