When Creating Pro Forma Statements,the External Financing Need Will Increase

question 40

Multiple Choice

When creating pro forma statements,the external financing need will increase if you

• A)increase the corporate tax rate.
• B)decrease the dividend payout ratio.
• C)increase the plowback ratio.
• D)decrease the rate of sales growth.
• E)decrease the projected level of sales.

---

Definitions:

Unconscionable Transactions Relief Act

Legislation providing remedies against agreements made under unfair conditions.

Protection

Measures or actions taken to guard against harm, damage, loss, or any unwanted outcome, often referring to safeguarding people, property, or interests.

Promissory Note

A written promise to pay a specified sum of money to another party under agreed terms at a specified time.

Bill of Exchange

A written, unconditional order by one party, directing another party to pay a specific sum of money to a third party on demand or at a set time.