Investing and Financial Markets
Financial Statements

Rapid corporate growth in sales and profits can cause financing problems Elaborate on this statement?

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2010-03-02 22:20:39

Oftentimes when a business undergoes rapid growth in sales

and profits, asset growth also increases rapidly. It may be

difficult for a business to come up with the funds from suppliers,

the bank, or stockholders in a reasonable amount of time. For

example, if I made $30K profit this year but asset growth was $60K

due to the growth, I would have to find a way to finance the

remaining amount.

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