The Preparation of Pro Forma Financial Statements Accomplishes Which of the Following

question 37

Multiple Choice

The preparation of pro forma financial statements accomplishes which of the following objectives?

• A)It allows management to pinpoint a firm's optimal share price.
• B)It is essential if the firm is to accurately estimate its weighted average cost of capital.
• C)It assists management in making decisions with respect to raising the capital that is needed for growth.
• D)It pinpoints periods when the firm will have short-term cash surpluses.

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Definitions:

Industrial Market

The sector of the economy in which businesses sell products or services to other businesses for production, not directly to consumers.

Resellers

are businesses or individuals that purchases goods for the purpose of selling them again rather than using them.

Organizational Markets

Markets composed of businesses and other organizations that buy goods and services for use in their operations or in the production of other goods and services.

Amazon.com

An American multinational technology company which focuses on e-commerce, cloud computing, digital streaming, and artificial intelligence.