Spontaneous funds are generally defined as follows:
A. A forecasting approach in which the forecasted percentage of sales for each item is held constant.
B. Funds that a firm must raise externally through short-term or long-term borrowing and/or by selling new common or preferred stock.
C. 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.
D. 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.
E. Assets required per dollar of sales.
Answer: C
You might also like to view...
Explain the difference between transformational and transactional leadership.
What will be an ideal response?
What type of plan are traditional investors and bankers likely to require?
a. a pitch deck b. a traditional business plan c. a business brief d. a feasibility study
An instrument is negotiable if it satisfies six standards. Which of the following is a standard of negotiability?
a. The instrument can be oral provided there is proof beyond a reasonable doubt. b. The instrument must be signed by the payee. c. The instrument must be conditional. d. The instrument must state a definite sum of money.
What arguments might be used to persuade shareholders in an acquisition target to reject offers at any price? Are they plausible?
What will be an ideal response?