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Which of the following statements is CORRECT? EXPLAIN YOUR ANSWER a. When we use the AFN equation, we assume that the ratios of assets and
Which of the following statements is CORRECT? EXPLAIN YOUR ANSWER a. When we use the AFN equation, we assume that the ratios of assets and liabilities to sales (A0*/S0 and L0*/S0) vary from year to year in a stable, predictable manner. b. When fixed assets are added in large, discrete units as a company grows, the assumption of constant ratios is more appropriate than if assets are relatively small and can be added in small increments as sales grow. c. Firms whose fixed assets are
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