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The percent of sales method is a forecasting method that predict financial elements based on their relationship to

Question

The percent of sales method is a forecasting method that predict financial elements based on their relationship to

sales. In other words, these items increase proportionately as sales increase. This method can be applied to many, but not all, of the elements of the pro forma statements. Which of the following cannot be accurately predicted with this method?

Operating expenses

Capital investments

Advertising expenses

Accounts receivable

Financial Accounting

The percent of sales method is a forecasting method that predict financial elements based on their relationship to