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Exam 9: Building Your Pro Forma Financial Statements

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Question 1

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Financial analysis is simply the mathematical expression of an overall business strategy.

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Question 2

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For an asset to appear on the balance sheet it must generate revenue.

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By closing your sales for credit, you can increase your company's cash flow.

The bottom line of the income statement states the company's _______.

The following are examples of operating expenses, except:

Businesses should expect to build their sales and start operating efficiently within a five-year period.

You should attempt to calculate your operating costs before you start a business.

Investors often predict the market share of startups as 3% after Year 3, because of the ease with which 3% can be captured.

It is critical to show the first two years of pro-forma projections on a monthly basis because this is when a company is most vulnerable to failure.

An accumulated depreciation line item on your balance sheet shows how much of the asset has been:

The statement of cash flows starts with which of the following?

The chapter recommends that you should construct monthly income and cash flow statements for the first:

The expenses that a business incurred appear on a different financial document than the amount of cash that it spent.

Under the Comparable Method, you can see how the model changes overall when you:

Approximately how many subsections in the section of the planning process should your explanation of the financial statements have, if you follow the model in the chapter?

The expense of acquiring land should appear in full on your annual income statement.

According to the chapter, it takes time to:

In the build-up method, you look at the revenue you might generate and the cost you might incur in a typical day.

An optimistic attitude about your business's future helps achieve positive cash flow sooner.

Gross margin is calculated with the formula