Which One of the Following Statements Is NOT True About

question 90

Multiple Choice

Which one of the following statements is NOT true about financial planning models?

• A) Financial statements serve as the first major input and become the baseline to compare the projected financial statements.
• B) Macroeconomic forecasts and their impact on the firm's sales are also included.
• C) Investment and financing decisions are not considered as inputs.
• D) Changes in the firm's balance sheet and income statement items as a result of the growth in sales are also used in these models.

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Definitions:

Long-Term Liabilities

All of the entity’s obligations that are not classified as current liabilities.

Balance Sheet

A financial statement that summarizes a company's assets, liabilities, and shareholders' equity at a specific point in time, providing a snapshot of its financial condition.

Future Cash Flows

Estimates of the amounts of cash that a company expects to receive or pay out in the future, important for budgeting, forecasting, and valuation.

Interest-Bearing Note

A debt instrument that pays interest to the holder at a fixed or variable interest rate until the principal amount is repaid.