is my response accurate The primary objective of forecasting financial statements is to develop:financial statements for comparison to industry averages.O a projection of future cash flows for valuation purposes.a balance sheet and income statement that reflect past performance.None of the above.

Referencehttps://www.sciencedirect.com/science/article/pii/B9780750661362500740

Answered: The primary objective of forecasting…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter3: Evaluation Of Financial Performance

Section: Chapter Questions

Problem 1QTD

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Similar questions

Which one of the following items is not a method/tool of analysis of financial statements a. Trend Analysis b. Statement of Affairs c. Cash Flow Statement d. Comparative Statements
The building blocks of financial statement analysis does not include: a. Market expectations. b.Liquidity. c.Solvency. d.Profitability.
What is forecasted financial statements (FFS) method?
1. Which one of the following is not a characteristic generally evaluated in analyzing financial statements? a. Liquidity b. Profitability c. Solvency d. Marketability 2. What is the most widely used liquidity ratio? a. Quick ratio b. Inventory turnover c. Current ratio d. Debt ratio
In isolation, which of the following is TRUE about a financial ratio? Select one: a. Useful only for past performance b. Useful piece of information c. Useful only for future predictions d. Useless piece of information
Which of the following statements is CORRECT? Perhaps the most important step when developing forecasted financial statements is to determine the breakdown of common equity between common stock and retained earnings. The AFN equation produces more accurate forecasts than the forecasted financial statement method, especially if fixed assets are lumpy and economies of scale exist. The first, and perhaps the most critical, step in forecasting financial requirements is to forecast future sales. Forecasted financial statements, as discussed in the text, are used primarily as a part of the managerial compensation program, where management's historical performance is evaluated. The capital intensity ratio gives us an idea of the physical condition of the firm's fixed assets
The overriding qualitative characteristic of useful financial statements is Select answer from the options below 1.consistency. 2.accuracy. 3.verifiability. 4.relevance.
Which of the following is an assumption made in the preparation of the financial statements? Select one: a. The current market value is assumed to be less relevant than the original cost paid. b. Financial statements are prepared for a specific entity that is distinct from the entity's owners. c. The preparation of financial statements for a specific time period assumes that the balance sheet covers a designated period of time. d. Financial statements are prepared assuming that inflation
What are some of the problems is using AFN equation to estimate AFN rather than the pro-forma financial statement method?
Match the ratio to the building block of financial statement analysis to which it best relates.A. Liquidity and efficiency B. Solvency C. Profitability D. Market prospects Times interest earned
Explain why balance sheet accounts are generally “averaged” and income statement figures are just lifted from the income statement when using them as factors in a particular financial statement ratio? How do the DuPont technique helps the firm’s managers to further analyze its returns?
Which of the following is not a factor in producing earnings forecasts? a) Estimating the level of dividends b) Separation of recurring and nonrecurring components c) Recognizing potential earnings management d) Recognizing potential income smoothing

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The primary objective of forecasting financial statements is to develop: financial statements for comparison to industry averages. O a projection of future cash flows for valuation purposes. a balance sheet and income statement that reflect past performance. None of the above.