Examples of Assumptions That Are Often Required to Be Made

question 21

Multiple Choice

Examples of assumptions that are often required to be made by the financial planner in the preparation of a SOA include those relating to:

• A) tax rates.
• B) age of the client.
• C) age of the client
• D) both a and c

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Definitions:

Depreciation Expense

Apportioning the value of a concrete asset throughout its operational life.

Sales Price

The amount of money for which a product or service is sold to customers, not necessarily reflecting the cost of production or provision.

Contribution Margin

The amount by which a product's selling price exceeds its total variable costs, indicating how much contributes to covering fixed costs and generating profit.

Fixed Costs

Costs that do not change with the level of output or sales, such as rent, salaries, and insurance.