1) The sales forecast may be presented as:

a. None of these

b. A growth rate in sales

c. An explicit sales figure

d. Either a growth rate in sales or an explicit sales figure

2) Alternative business plans are typically prepared for:

a. High, medium, and low probabilities

b. Short, medium, and long-run forecasts

c. Small, medium and large growth rates

d. Best, normal, and worst case scenarios

3) The firm's total capital budget is the:

a. Change in net working capital

b. Change in total fixed assets

c. Sum of the change in total fixed assets and change in net working capital

d. None of these

4) If the pro forma balance sheet indicates that the projected assets exceeds the projected liabilities and equity, then:

a. New financing (the financial plug variable) will be needed

b. Additional dividends should be paid

c. The sales growth forecast indicated an anticipated decline in sales

d. The assumptions made within the financial forecasting process were incorrect

5) Financial planning over the long run would usually be taken to consider:

a. 2-5 years

b. 12 months

c. 10-20 years

d. 5-10 years

6) Pro forma financial statements will typically include a projected:

a. Income statement

b. All of these

c. Statement of cash flows

d. Balance sheet