When a Company Has Its Sales Forecasts Prepared by Management

question 73

Multiple Choice

When a company has its sales forecasts prepared by management consultants, economists, or college professors, it is using a(n)

• A) expert forecasting survey.
• B) Delphi technique.
• C) random factor analysis.
• D) external judgment survey.
• E) market test.

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Definitions:

Predicted Sales

Forecasted revenue from goods or services sold over a future period, based on current trends or analyses.

Sales Dilution Approach

A method used in finance to estimate the impact of issuing new shares on the earnings per share by assuming no increase in sales.

Pro Forma Balance Sheets

Financial statements prepared in advance of a planned transaction, showing the expected financial position of a company.

Pro Forma Statements

are financial reports that companies use to project future financial performance based on past and current financial conditions.