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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
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 a decrease of the additional funds needed (AFN)? Hint: review the AFN formulas. a. A sharp increase in its forecasted sales. b. The company switches its materials purchases from a supplier that sells on terms of 1/5, net 90, to a supplier whose terms are 3/15, net 35. The company now must pay suppliers in almost 1/3 of the time they were allowed from the previous supplier, but they get a larger discount if paid early. c. The company discovers that it has no excess capacity in its fixed assets so is operating at full capacity d. The company reduces its dividend payout ratio
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