When Dealing with Financial Projections, Which of the Following Generally

question 28

Multiple Choice

When dealing with financial projections, which of the following generally links the income statement to the balance sheet?

• A) The amount paid in interest recorded as decrease in debt.
• B) Equity being increased by the amount of net income.
• C) Assets increasing by the amount of revenue.
• D) Cash increasing by the amount of EBIT.

---

Definitions:

Labor Cost

The total expenditure incurred by employers for the wages, benefits, and taxes of their workforce.

Marginal Revenue Productivity

The additional revenue generated by hiring one more unit of a factor of production, such as labor.

Profit-maximizing

A strategy or point at which a business reaches the highest possible difference between its total revenues and total costs.

Resources

Inputs or factors used in the production of goods and services, typically categorized into labor, capital, land, and entrepreneurship.