Course: Financial Management

Module 3 Quiz: Financial Planning and Forecasting

Name:_____________________________________________________________

TRUE OR FALSE

Instruction: Check ‘T’ if the statement is ‘true’ and ‘F’ if the statement is ‘false’.

T F
☐ ☐ 1. Financial Planning involves analyzing the financial flows of a firm; forecasting the
consequences of various investment, financing, and dividend decisions; and
considering the effects of different alternatives.
☐ ☐ 2. Key inputs to short-term financial plans include sales forecast and various forms of
operating and financial data.
☐ ☐ 3. The idea of financial planning is to know the past, present, and future of the firm.
☐ ☐ 4. The most comprehensive means of doing financial planning and forecasting is to
come up with pro-forma financial statements.
☐ ☐ 5. The Statement of Cash Flows shows the amount and timing of cash flows.

MATCHING TYPE

Instruction: Match the concepts with their descriptions. Write the letter that corresponds to
your answer.

Concept Description
1. Long-term Financial A Package of different budgets
Plan
2. Short-term Financial B Projection of a firm’s income for a period of
Plan time in the future
3. Master Budget C Lays out specific one to two years financial
activities considering the impact of those
actions
4. Profit Plan D Projection of future cash receipts and
disbursements over a given financial period
5. Cash Budget E Considers proposals for capital
expenditures, research and development
undertakings, marketing and product
development actions, capital structure, and
major sources of financing

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