Exam 10: The Financial Plan

Which of the following statements is not true of a cost benefit analysis

In projecting the operating expenses for the second and third year,it is helpful to first look at those expenses that will likely change over time. 

Define capital budgeting. 

Negative cash flow: 

Pro forma cash flow is: 

Labor hours,utility costs,or training costs are considered direct costs. 

When projecting cash flows for the pro forma cash flow statement,it is important to be conservative in the estimates. 

Cash flow is the result of subtracting expenses from sales. 

The basic balance sheet relationship is: 

Assets represent the net worth of the firm. 

Any significant capital expenditure or project requires a lengthy,and expensive,cost benefit analysis. 

Which of the following software programs is most widely used by entrepreneurs  

Owner's equity represents: 

Profit from the business would be included on the balance sheet in which section  

Cost benefit analysis is a complex approach that considers the cash flows or the value of money over a period of time. 

Rent and insurance are examples of variable costs. 

Fixed operating expenses include all of the following except: 

________ is the volume of sales needed to cover total variable and fixed costs. 

The ________ method is the most popular method used to project cash flow. 

________ is projected net profit calculated from projected revenue minus projected costs and expenses.