Creating Projected (Pro Forma) Financial Statements Would Allow a Business

question 120

Multiple Choice

Creating projected (pro forma) financial statements would allow a business owner to answer which of the following questions?

• A) What profit can my business expect to achieve?
• B) What sales level must my business reach if our targeted profit is × dollars?
• C) What fixed and variable expenses can my business expect to incur at our targeted sales level?
• D) All of the above

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Definitions:

Phenotype

The set of observable characteristics or traits of an organism resulting from the interaction of its genotype with the environment.

Underlying

Constituting the fundamental or basic layer or aspect of something, often not immediately visible or apparent.

Observed

Noted or perceived through careful attention or surveillance.

Genotype

The genetic constitution of an individual organism, determining inherited characteristics.