4.In preparing a cash flow forecast, a firm is likely to employ a minimum acceptable cash balance:

A)   of zero.

B)   that includes a component for opportunities that may arise.

C)   equal to the amount necessary to pay projected payables, interest, taxes, and day-to-day expenses.

D)   which includes estimated expenses and a margin for unforeseen expenses only.

5.Projected net capital expenditures and financing decisions are most important as a component of a firm’s:

A)   pro-forma income statement.

B)   expected operating cash flows.

C)   long-term cash flow forecast.

D)   balance of payments.

6.Which of the following statements regarding long-term forecasts of cash flows is most accurate? Long-term cash flow forecasts are:

A)   constructed from recent daily and weekly cash flows.

B)   are usually more accurate than short term cash flow forecasts.

C)   based on pro-forma balance sheet projections for future years.

D)   are constructed without considering future financing decisions.

答案和详解如下：

4.In preparing a cash flow forecast, a firm is likely to employ a minimum acceptable cash balance:

A)   of zero.

B)   that includes a component for opportunities that may arise.

C)   equal to the amount necessary to pay projected payables, interest, taxes, and day-to-day expenses.

D)   which includes estimated expenses and a margin for unforeseen expenses only.

The correct answer was B)

Firms typically establish some minimum level of cash balances that they feel are necessary for their business. Cash may be needed for unforeseen costs as well as to take advantage of opportunities that arise, such as discount prices on important inputs.

5.Projected net capital expenditures and financing decisions are most important as a component of a firm’s:

A)   pro-forma income statement.

B)   expected operating cash flows.

C)   long-term cash flow forecast.

D)   balance of payments.

The correct answer was C)

Long-term cash flow forecasts are derived from projected income statements and balance sheets for future years that are based on statistical models of sales, credit collections, and input costs, as well as planned capital expenditures, asset sales, and financings. Pro-forma income statements can be affected by projected capital expenditures (through expected depreciation expense) and financing (through interest expense) but long-term cash flow forecasts are more directly affected by expected capital expenditures and financing activities. Operating cash flows are not directly affected by financing and capital spending decisions (only indirectly through interest and taxes), which are classified as financing and investing activities, not operating activities.

6.Which of the following statements regarding long-term forecasts of cash flows is most accurate? Long-term cash flow forecasts are:

A)   constructed from recent daily and weekly cash flows.

B)   are usually more accurate than short term cash flow forecasts.

C)   based on pro-forma balance sheet projections for future years.

D)   are constructed without considering future financing decisions.

The correct answer was C)

Long-term forecasts are derived from projected income statements and balance sheets for future years that are based on statistical models of sales, credit collections, and input costs as well as planned capital expenditures, asset sales, and financings.