Question 1

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

Accepted Answer

A) True 
 B)False  False

Question 2

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

Accepted Answer

A) True 
 B)False  False

Question 3

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

Accepted Answer

A) True 
 B)False  True

Question 4

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

Accepted Answer

A)  Used up 
B)  Acquired 
C)  Written-off 
D)  None of the above 
E)  All of the above 
A)  Used up 
B)  Acquired 
C)  Written-off 
D)  None of the above 
E)  All of the above

Question 5

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

Accepted Answer

A)  Increase your revenues 
B)  Leverage your drivers 
C)  Tweak your inventories 
D)  Change one of the assumptions 
E)  Decrease your costs 
A)  Increase your revenues 
B)  Leverage your drivers 
C)  Tweak your inventories 
D)  Change one of the assumptions 
E)  Decrease your costs

Question 6

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?

Accepted Answer

A)  1 
B)  3 
C)  4 
D)  7 
E)  8 
A)  1 
B)  3 
C)  4 
D)  7 
E)  8

Question 7

According to the chapter, it takes time to:

Accepted Answer

A)  Build up your clientele 
B)  Learn to operate efficiently 
C)  Develop track record 
D)  Understand seasonality 
E)  All of the above 
A)  Build up your clientele 
B)  Learn to operate efficiently 
C)  Develop track record 
D)  Understand seasonality 
E)  All of the above

Question 8

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

Accepted Answer

A) True 
 B)False

Question 9

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

Accepted Answer

A) True 
 B)False

Question 10

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

Accepted Answer

A) True 
 B)False

Question 11

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

Accepted Answer

A) True 
 B)False

Question 12

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

Accepted Answer

A) True 
 B)False

Question 13

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

Accepted Answer

A)  Net Income 
B)  Costs 
C)  Expenses 
D)  Net Assets 
E)  Net Liabilities 
A)  Net Income 
B)  Costs 
C)  Expenses 
D)  Net Assets 
E)  Net Liabilities

Question 14

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.

Accepted Answer

A) True 
 B)False

Question 15

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

Accepted Answer

A)  net size 
B)  net income 
C)  revenue less expenses 
D)  net assets value 
E)  gross profit margin 
A)  net size 
B)  net income 
C)  revenue less expenses 
D)  net assets value 
E)  gross profit margin

Question 16

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

Accepted Answer

A) True 
 B)False

Question 17

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

Accepted Answer

A)  1 year 
B)  2 years 
C)  3 years 
D)  4 years 
E)  5 years 
A)  1 year 
B)  2 years 
C)  3 years 
D)  4 years 
E)  5 years

Question 18

Gross margin is calculated with the formula

Accepted Answer

A)  Revenue plus COGS 
B)  Gross Profit times COGS 
C)  Price plus Gross Profit 
D)  Revenue minus COGS 
E)  Revenue times profit 
A)  Revenue plus COGS 
B)  Gross Profit times COGS 
C)  Price plus Gross Profit 
D)  Revenue minus COGS 
E)  Revenue times profit

Question 19

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

Accepted Answer

A) True 
 B)False

Question 20

The following are examples of operating expenses, except:

Accepted Answer

A)  Property purchases 
B)  Rent expenses 
C)  Interest expenses 
D)  Salaries 
E)  Administrative expenses 
A)  Property purchases 
B)  Rent expenses 
C)  Interest expenses 
D)  Salaries 
E)  Administrative expenses

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

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

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

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

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?

According to the chapter, it takes time to:

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

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

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

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

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

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

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.

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

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

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

Gross margin is calculated with the formula

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

The following are examples of operating expenses, except:

The Power of Entrepreneurship

The Entrepreneurial Process

Opportunity Recognition, Shaping, and Reshaping

Prototyping Your Ideas

Understanding Your Business Model and Developing Your Strategy

Entrepreneurial Marketing

Building the Founding Team

The Business Planning Process

Financing Entrepreneurial Ventures Worldwide

Raising Money for Starting and Growing Businesses

Debt and Other Forms of Financing

Legal and Tax Issues, Including Intellectual Property

Entrepreneurial Growth

Social Entrepreneurship

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Exam 9: Building Your Pro Forma Financial Statements

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

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

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

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

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?

According to the chapter, it takes time to:

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

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

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

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

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

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

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.

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

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

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

Gross margin is calculated with the formula

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

The following are examples of operating expenses, except:

The Power of Entrepreneurship

The Entrepreneurial Process

Opportunity Recognition, Shaping, and Reshaping

Prototyping Your Ideas

Understanding Your Business Model and Developing Your Strategy

Entrepreneurial Marketing

Building the Founding Team

The Business Planning Process

Financing Entrepreneurial Ventures Worldwide

Raising Money for Starting and Growing Businesses

Debt and Other Forms of Financing

Legal and Tax Issues, Including Intellectual Property

Entrepreneurial Growth

Social Entrepreneurship

Filters