Which of the Following Is NOT One of the Steps

question 11

Multiple Choice

Which of the following is NOT one of the steps taken in the financial planning process?

• A) Forecast the funds that will be generated internally. If internal funds are insufficient to cover the required new investment, then identify sources from which the required external capital can be raised.
• B) Monitor operations after implementing the plan to spot any deviations and then take corrective actions.
• C) Determine the amount of capital that will be needed to support the plan.
• D) Develop a set of forecasted financial statements under alternative versions of the operating plan in order to analyze the effects of different operating procedures on projected profits and financial ratios.
• E) Consult with key competitors about the optimal set of prices to charge, i.e., the prices that will maximize profits for our firm and its competitors.

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Definitions:

Debts Reduced

A situation where the total amount owed by an individual or entity is decreased through negotiation, settlement, or by making payments.

Liability

An obligation or debt owed by an individual or company, typically financial, that arises from past transactions or actions.

Bankruptcy

A legal proceeding involving a person or business that is unable to repay outstanding debts, which allows for the assets of the debtor to be measured and evaluated, and the liabilities to be discharged or restructured under the protection of bankruptcy court.

Loan Agreement

A contract between a borrower and a lender outlining the terms and conditions of a loan.