Short-term forecasts are based on:
a) sales revenues and future tax policies.
b) predictions of future performance of the firm's new products.
c) capital expenditures for the next five years.
d) expected sales revenues and expenses for the coming year.
Answer: D
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GEB Chapter 18
- Internal audits are important because:
- One of the consequences of the recent financial crisis was ________.
- If your job is to compare actual expenses incurred by your company with financial projections previously created, you are performing the task of ________.
- Commercial finance companies accept more risk than banks, and the interest rates they charge are usually ________ than commercial banks.
- Rachael Straub works in finance for a small microbrewery. This week Rachael is working on a budget for the next 12 months. She has been doing research to determine prices for the new equipment they will need in the next 12 months to stay competitive in this market. Which of the steps in financial planning is Rachael involved in?
- Idle Time Gaming, Inc., knows that its stockholders expect a return on their investment. The expected return that stockholders anticipate translates into the company's ________. Essentially, this is the amount that the investment funds are costing the firm.
- Accepting bank credit cards represents one way to decrease:
- Issuing stock as a source of funding is referred to as ________.
- Companies must have a carefully constructed inventory policy in order to:
- Marco's Italian Gardens, an authentic Italian restaurant in suburban Chicago, worked with a local bank for a ________. This unsecured source of funds was available for Marco to tap into if he needed immediate funds for the business. He liked the fact that he had a cushion and only used it if he fell short of funds.
- Which of the following is a major reason why businesses fail financially?
- Financial managers examine the financial data prepared by ________ and make recommendations to top executives about strategies for improving the financial strength of a firm.
- The Credit Card Responsibility Accountability and Disclosure Act of 2009 did very little to protect ________ from increases in credit-card interest rates and fees.
- The financial manager for Bellandro Bay Brewery is working with the firm's marketing department to bring out a new line of pumpkin ale. The new product development and subsequent production will require a long-term investment of funds by the company. Which of the following sources of financing would be representative of such a long-term funding requirement?
- Which of the following is a long-term debt obligation of a corporation or government?
- What is the major problem with selling on credit?
- Taxes represent ________.
- The time value of money means that:
- One advantage in using retained earnings as a long-term source of funds is ________.
- Debt financing:
- Backstreet Books, Inc., an eclectic book and music store near a large college campus, is a reseller. The operation buys books almost every day. Deliveries are constantly part of the day-to-day operation of the firm. The transportation company that delivers to Backstreet Books provides this service on trade credit terms of 3/5, net 30. This means the firm ________.
- Financial controls are designed to help managers to: