The correct answer is letter "D": percent-of-sales method.
Explanation:
The percentage-of-sales method is the fastest approach to develop a budget based on the financial statements. Expenses are compared to the net sales as percentages to be applied in the sales level for the budgeted period. However, to compare expenses to the items in the budget, the expense must be correlated to the item causing an issue because fixed expenses cannot be linked with sales, for instance.
They could end up financing them too much and need to borrow more money from China (we are very much in debt right now) nd then we would have more to pay
