FIN 357 CH4 with correct answers 100%

FIN 357 CH4 with correct answers 100% A lack of effective long-range planning is commonly cited as a reason for ______. financial distress inflation negative interest yields financial prosperity - Correct Answer financial distress Financial planning is a(n) ______ process. static inert iterative one-time - Correct Answer iterative Growth, by itself, (is/isn't) a good financial goal. - Correct Answer isn't The smaller investment proposals of each operational unit are added up, and the sum is treated as one big project, which is called _________ - Correct Answer aggregation One advantage to well-executed financial planning is that the firm can ______. be sure of final outcomes of investments get ahead of the competition avoid surprises correct past mistakes - Correct Answer avoid surprises A commonly cited reason for financial failure is a lack of _________. marketing savvy good relations with investors effective long-range planning tax relief - Correct Answer effective long-range planning Across firms, the financial planning process _________. is different for each firm always follows the same steps is basically the same for each firm - Correct Answer is different for each firm A financial plan looks at what needs to be done in the __________. past future present - Correct Answer future Which of the following are common elements of a financial planning model? SELECT ALL THAT APPLY Sales forecast Economic assumptions Pro forma statements Elasticity of demand estimates Government approval - Correct Answer Sales forecast Economic assumptions Pro forma statements It is typically assumed that total assets (increase/decrease) with increased sales because additional working capital and fixed assets are needed to support growth. - Correct Answer increase The aggregation process determines the total _________. planning horizon debt requirement needed investment sustainable growth - Correct Answer needed investment Which of the following are likely to be accomplished with financial planning? SELECT ALL THAT APPLY Outcome certainty Avoiding surprises Exploring options Perfect forecasts - Correct Answer Avoiding surprises Exploring options The percentage of ____________ approach is a financial planning method in which accounts are varied depending on a firm's predicted sales level. - Correct Answer sales A pro forma balance sheet indicates that total assets will increase by $300,000. If a debt-equity ratio of 0.5 is maintained, then debt must increase by: $300,000. $150,000. $200,000. $100,000. - Correct Answer $100,000. Reason: If D/E = 0.5, an increase of $300k in assets will be financed with $100k of debt and $200k of equity. Pro _________ statements are one of the key elements of financial planning. - Correct Answer forma Weston's financial planning model shows assets are projected to increase by $2.7 million while liabilities and equity increase by $1.5 million. What is the external financing need (EFN)?