What Is the Second Step in Preparing a Financial Plan

question 22

Multiple Choice

What is the second step in preparing a financial plan?

• A)Determine the expected level of profits for future periods
• B)A forecast of revenue over some future time period
• C)Estimate the funds needed to implement the strategies
• D)Estimate how many additional assets the company will need

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Definitions:

Straight-Line Method

A method of calculating depreciation or amortization by evenly dividing the asset’s cost over its useful life.

Salvage Value

The estimated residual value of an asset at the end of its useful life, expected to be recovered after its use is completed.

Monthly Depreciation

The portion of an asset’s cost that is expensed each month over its useful life.

Old Plant Asset

An asset that has been in use for a considerable period and is often nearing the end of its useful life.