The accuracy of the percent of sales forecast method is impaired if

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All of the given options impair the accuracy of the percent of sales forecast method. Scale economies for assets refer to the fact that as sales volume increases, the cost per unit of the asset decreases - this means that the percent of sales investment needed to acquire more assets will also decrease. Similarly, if assets must be purchased in discrete quantities, the percent of sales investment will need to jump in large increments when the threshold for the next purchase is reached. Lastly, if asset needs do not correlate with sales volume, the percent of sales forecast method will not accurately reflect the investment needed to support increased sales.

The Accuracy of the Percent of Sales Forecast Method Is