When preparing pro forma income statements, which one of the following items is least

likely to be sales driven？

A. Current assets.

B. Interest expense.

C. Administrative expenses.

Ans: B.

Interest expense is considered a fixed burden and a function of a firm’s capital structure, not sales.

A is incorrect. Current assets are normally a sales driven account.

C is incorrect. Administrative expenses, although they may contain fixed costs, are primarily sales driven.

14. Which of the following pairs of general categories are least likely to be considered in the formulas used by credit rating agencies to determine the capacity of a borrower to repay a debt？

A. Operational efficiency; leverage.

B. Margin stability, availability of collateral.

C. Leverage; scale and diversification.

查看答案

如搜索结果不匹配，请联系老师获取答案

您可能会需要：

重置密码查看订单联系客服

安装上学吧APP，拍照搜题省时又省心！

更多“When preparing pro forma incom…”相关的问题

第1题

An analyst gathers the following information about 2011 actual results for a company and its projected sales, COGS, and assets for 2012:

Based on the projected sales increase, the best estimate of 2010 projected current assets isclosest to:

A. ￡1,890,000.

B. ￡1,980,000.

C. ￡2,070,000.

点击查看答案

第2题

As a result of a change in strategy to selling differentiated products at premium prices, a company’s gross margin ratio increased by 5% (i.e., from 35% to 40%). The most likely effect on the company’s operating margin ratio as a result of the change in strategy would be an increase:

A. equal to 5%.

B. less than 5%.

C. greater than 5%.

点击查看答案

第3题

At the beginning of a year, Company X has opted to sell all of its $450,000 of receivables to finance a reduction in its long-term debt. The receivables and the risk of default are transferred at 80% of their book value. The debt reduction will reduce interest expense from $50,000 to $25,000 per year. The effective tax rate is 30%. Assuming that the current year’s EBIT is $142,500, at the end of the year, the results of the receivables sale will be an interest coverage ratio closest to:

A. 1.1X.

B. 2.1X.

C. 3.1X.

点击查看答案

第4题

Selected information about a company is as follows:

The forecasted net income (in ‘000) for 2013 is closest to: