FINANCIAL PLANNING

Question 1

this includes the fund requirements to start up a business idea, the sources of those fund and the profits expected from the operation

Answer 1

FINANCIAL PLAN

Question 2

in preparing a financial plan, a/an _______ must first know or have an idea how much the cost of establishing the business

Answer 2

entrepreneur

Question 3

the cost of establishing the business

Answer 3

PROJECTED COST

Question 4

items to be considered in determining the project costs

Answer 4

COST OF PPE
RENT
ORGANIZATION COST
INITIAL WORKING CAPITAL
CONTINGENCIES

Question 5

this is the total cost to be incurred in the acquisition of company property such as land, building, machinery, equipment, furniture, and alike.

Answer 5

COST OF PPE

Question 6

includes the amount paid in getting various licenses and permits from different government agencies

Answer 6

ORGANIAZTION COST

Question 7

the amount of money needed for a certain period of time such as 3-6 months in order to support expenses the business will incur in case of small revenue.

Answer 7

INITIAL WORKING CAPITAL

Question 8

those expenses that the company have not foreseen while in the process of setting up the business.

Answer 8

CONTINGENCIES

Question 9

this will showcase the projected and possible resources (assets, liabilities, and net worth or equity of the company on a five year period.)

Answer 9

FINANCIAL POSITION / BALANCE SHEET

Question 10

this is very essential in order to show the business condition, structure, and position will look like within a five-year period.

Answer 10

FINANCIAL POSITION / BALANCE SHEET

Question 11

this will show the company’s operating performance in the next 5 years

Answer 11

INCOME STATEMENT

Question 12

this shows what causes the increase or decrease in the owner’s capital account

Answer 12

STATEMENT OF CHANGES IN EQUITY

Question 13

this means estimating or predicting future business performance. this also includes the income sources such as sales, services, interest on bank deposits, dividends, and commissions

Answer 13

FORECASTING

Question 14

_________ are based on the results of the sole proprietor’s interviews with small trading businesses in the neighborhood

Answer 14

ESTIMATED SALES

Question 15

to attract customers and still make a profit, the mark-up should range only from ____ to ______

Answer 15

5.59% to 5.82%

Question 16

this refers to expenditures incurred in generating revenues

Answer 16

COSTS

Question 17

two components of forecasting costs incurred in manufacturing and trading businesses

Answer 17

1. COST OF GOODS SOLD
2. SELLING AND ADMINISTRATIVE EXPENSES

Question 18

this includes the salaries, commissions, and entertainment expenses of salespeople and representatives.

Answer 18

SELLING EXPENSES

Question 19

usually consist of taxes; licenses and fees; electricity, water and telephone expenses; salaries/wages of accountants, clerks, janitors, and transportation expenses

Answer 19

ADMINISTRATIVE EXPENSES

Question 20

total costs are determined by _____

Answer 20

adding the two components: cost of goods sold + selling & administrative expenses

Question 21

refer to the difference between revenues and costs

Answer 21

PROJECTED INCOME

Question 22

if the income, expenses, and profits consistently increase each year, the trend is said to be ____

Answer 22

UPWARD

Question 23

if income, expenses, and profits consistently go down each year, then the trend is considered _____

Answer 23

DOWNWARD

Question 24

if income, expenses, and profits go up in one year, drop the following year, then move up again in the next year, the business trend is described as ______

Answer 24

IRREGULAR