Exam 11: Financial Preparation for Entrepreneurial Ventures

Capital budgeting is used to help the entrepreneur plan for capital expenditures.

Net present value method is a capital budgeting technique that helps to minimize some of the shortcomings of the payback method by

A manufacturing firm needs to establish which of the following budgets?

The first type of expense to be estimated when preparing an operating budget is cost of goods sold.

One of the easiest capital budgeting methods to understand is

The cash-flow budget provides an overview of cash inflows and outflows for the budget period.

A variable cost

For a manufacturing firm, the production budget represents

Despite the drawbacks of the payback method, the entrepreneur should continue to use it because

Explain what a cash flow budget tells a manager/owner.

A budget that is a statement of estimated income and expenses over a specified period of time is referred to as an

Which of the following are forms of pro forma statements?

The last step in preparing the operating budget is to

What is included in an operating budget and how is this helpful?

Loan proceeds are not directly tied to

Ratio analysis can be applied from which of the following directions?

In the simple linear regression analysis equation, Y = a + bx, x represents

A gross margin ratio of 38 percent means that for every $1 of sales, a firm produces 62 cents of gross margin.

The first step in the preparation of the cash flow budget is the identification and timing of cash outflows.

Financial information is important to entrepreneurs because: