Garry, a Financial Manager at AtoZ Technologies, Wants to Know

question 28

Multiple Choice

Garry, a financial manager at AtoZ technologies, wants to know when his firm will need to arrange for short-term financing and when the firm is likely to have surplus cash available to pay off loans or to invest in short-term liquid assets. These concerns suggest that Garry would want to develop a _____.

• A) cash budget
• B) pro forma income statement
• C) sales forecast
• D) projected balance sheet

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Definitions:

Convertible Debt

A short-term loan that can be turned into equity when future financing is issued.

Convertible Bond

A type of bond issued by a corporation that can be converted into a predetermined number of the company's equity shares at certain times during the bond's life, usually at the discretion of the bondholder.

Revolving Debt

A form of credit that allows the borrower to draw down, repay, and redraw loans repeatedly up to a certain credit limit.

Seed-stage Financing

Early financial investment aimed at supporting the launch and early growth of a startup, often in exchange for equity.