How Much Is Required in External Financing If First-Stage Pro

question 96

Multiple Choice

How much is required in external financing if first-stage pro forma statements indicate $1 million in net income,$300,000 in dividends,and a $900,000 increase in total assets?

• A) $200,000
• B) $500,000
• C) $600,000
• D) No external financing is required.

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Definitions:

One-tailed Test

A statistical hypothesis test in which the region of rejection is on only one side of the sampling distribution.

α

Symbol often used to represent the level of significance in hypothesis testing, typically denoting the probability of making a Type I error.

Null Hypothesis

A statement or hypothesis that assumes there is no significant difference or effect, serving as the basis for statistical testing.

Level of Significance

The threshold chosen for determining whether a statistical result is significant in hypothesis testing, typically set at values like 0.05, 0.01, etc.