Which source of financing is most appropriate for a company forecasting continued sales growth and increased receivables?

A revolving line of credit is the most appropriate source of financing for a company that is forecasting continued sales growth and increased receivables. This type of credit facility allows businesses to borrow money up to a predetermined limit, repay it, and then borrow again as needed. It provides flexibility in managing cash flow, as the company can draw down funds to cover immediate operational expenses or to address increased receivables arising from the sales growth.

As sales increase, so do the receivables, which means that the company may often need access to quick funds to manage operations or invest in additional inventory or resources to support the growth. A revolving line of credit adapts well to these needs, as it allows for borrowing in response to fluctuating financial requirements without having to reapply for a loan each time cash is needed.

Demand notes and bridge loans have more specific uses and limitations; demand notes can be called in by the lender without notice, which may not align with a company's need for consistent cash flow. A bridge loan serves as a short-term funding solution while waiting for long-term financing to be arranged, which may not be ideal for a company expecting ongoing growth. Seasonal lines of credit are restricted to specific times of the year, making them less suitable for continuous