The First Step in the Preparation of a Cash Budget

question 15

Multiple Choice

The first step in the preparation of a cash budget is

• A)calculating appropriate financial ratios.
• B)preparing a sales forecast.
• C)determining the firm's dividend policy.
• D)determining long-term capital structure.

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Definitions:

Tax Rate

The rate at which taxes are levied on an individual or a corporation's income.

Consolidated Tax Returns

A single tax return filed by a parent company and its subsidiaries as one taxpayer to IRS, consolidating their tax liabilities.

Income Tax Liability

The total amount of income tax owed to the government within a fiscal year.

Tax Rate

The rate at which the government taxes an individual or a corporation.