 | Chapter Concepts (See related pages)
- Financial forecasting is essential to the strategic growth of the firm.
- The three financial statements for forecasting are the pro forma income statement, the cash budget, and the pro forma balance sheet.
- The percent-of-sales method may also be used for forecasting on a less precise basis.
- The various methods of forecasting enable the firm to determine the amount of new funds required in advance.
- The process of forecasting forces the firm to consider seasonal and other effects on cash flow.
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