The AFN method assumes that the firm will require increasing amounts of assets for each dollar of sales, i.e. a higher capital intensity ratio, in the forecast period as compared to its most recent year. The AFN formula method assumes that the firm will generate the same amount of spontaneous liabilities for each dollar of sales in the forecast period as it had in its most recent year. (C) The AFN formula method assumes that the firm will continue to have the same profit margin and dividend payout ratio in the forecast period as it had in its most recent year. (D) If the AFN indicates that surplus funding is available, these funds should be used to purchase additional operating assets for the firm in the forecast period. Vhich of the following statements most correctly reflects the action Starbucks could take based upon the results of the AFN ormula? (A) Starbucks could repay up to $86.9 million to its creditors to reduce its holdings of long-term debt obligations. Starbucks will need to access at least $86.9 million in additional debt and/or common stock to meet its sales growth forecast. (C) Starbucks could repurchase its common shares valued at $86.9 million to meet its forecasted cash requirements. Starbucks could liquidate $86.9 million of its short-term investments to acquire the assets needed to meet its sales growth forecast. The AFN method assumes that the firm will require increasing amounts of assets for each dollar of sales, i.e. a higher capital intensity ratio, in the forecast period as compared to its most recent year. The AFN formula method assumes that the firm will generate the same amount of spontaneous liabilities for each dollar of sales in the forecast period as it had in its most recent year. (C) The AFN formula method assumes that the firm will continue to have the same profit margin and dividend payout ratio in the forecast period as it had in its most recent year. (D) If the AFN indicates that surplus funding is available, these funds should be used to purchase additional operating assets for the firm in the forecast period. Vhich of the following statements most correctly reflects the action Starbucks could take based upon the results of the AFN ormula? (A) Starbucks could repay up to $86.9 million to its creditors to reduce its holdings of long-term debt obligations. Starbucks will need to access at least $86.9 million in additional debt and/or common stock to meet its sales growth forecast. (C) Starbucks could repurchase its common shares valued at $86.9 million to meet its forecasted cash requirements. Starbucks could liquidate $86.9 million of its short-term investments to acquire the assets needed to meet its sales growth forecast
