Final answer:
The true statement about a straight commission compensation method is that it increases the need for working capital, as it is a variable pay structure depending on the salesperson's performance.
Step-by-step explanation:
The correct answer to the question "Which of the following is true of a straight commission compensation method?" is that it increases the need for working capital. Straight commission is a compensation method where a salesperson is paid based on the sales they generate, rather than receiving a fixed salary. Because the salesperson's income is directly tied to their sales performance, a straight commission structure can motivate them to work harder and sell more. However, it does not inherently provide the most security for a salesperson, as their income can vary greatly depending on their sales success. It can also be based on different metrics, not just a percentage of dollar sales - such as the volume of units sold or specific types of products, thereby making option D incorrect. Option E is also incorrect as depending on the nature of the business, the amount of sales supervision required may not necessarily be reduced; effective management and oversight are still critical in a commission-based environment.