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The Warren Corporation Wants to Enhance the Market Value of Its

question 39

Essay

The Warren Corporation wants to enhance the market value of its stock by including in its annual report a financial forecast for the next year.They also would like to have their auditors examine the forecast.
a.Define a financial forecast.
b.Is an examination of a financial forecast similar in scope to a review of financial statements?


Definitions:

Sales Revenue

The income received by a company from its sales of goods or services, before any expenses are deducted.

Unit Selling Price

The price levied for an individual unit of a product or service.

Break-even Analysis

A financial calculation to determine the sales volume at which a business neither makes a profit nor a loss.

Cost-volume-profit Analysis

An accounting method used to determine how changes in costs and volume affect a company's operating income and net income.

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