The Designated Source(s) of External Financing Required to Make the Pro

question 334

Multiple Choice

The designated source(s) of external financing required to make the pro forma balance sheet balance is called the:

• A) Retained earnings account.
• B) Common stock account.
• C) Debt-equity ratio.
• D) Cash flow variable.
• E) Plug variable.

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Definitions:

Investment Income

Income earned from investments, including dividends, interest, and capital gains from securities, real estate, or other assets.

Deferral Method

An accounting practice where certain revenues or expenses are deferred to a future accounting period to better match revenues with expenses.

Deferred Contribution

Refers to contributions or payments that are postponed to a future date rather than being made immediately.

Net Assets

The total assets of a company or organization minus its total liabilities; an indicator of financial health.