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Financial Forecasting and Decision Making

Exam Questions: 20
Course Level: Intermediate
Pages: 198 | Content: 194, Supplemental: 4
NASBA Area of Study: Accounting
Not Acceptable for: Enrolled Agents
Version: 7585A

This course will introduce you to the basic forecasting model. It will show you how to use this model to forecast sales and then use it for maximum sustainable growth. It will examine the effect of debt usage on a company's value and look at the relationship between its value and taxes, risk, and bankruptcy. The course will also clearly show how forecasting can help plan a company's capital structure and then demonstrate how this model can be used to forecast and reconcile the balance sheet as well as the income statement. PLEASE NOTE: Not accepted for Enrolled Agents. All course material provided. Prerequisites: Understanding of financial forecasting. Course level: Intermediate.

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Course Information

Table of Contents
  • Forecasting Prerequisites
  • Using the Basic Forecasting Model
  • Management Uses of the Forecasting Technique
  • Using Forecasting to Plan the Company's Capital Structure
  • Forecasting the Balance Sheet
  • Forecasting the Income Statement
  • Reconciling the Income Statement and Balance Sheet
  • Evidence of Growth Mismanagement
  • Maximum Sustainable Growth
  • Forecasting Sales
  • Integrating the Percent of Sales with a Shorter-Term Forecast of Cash Needs
  • The Basic Forecasting Model
Objectives
  • To identify the basic forecasting process
  • To recognize the importance of assumptions
  • To recognize uses for the forecasting model
  • To identify the risks involved with short-term debt
  • To identify the advantages of regression analysis
  • To identify how expenses change with changes in sales
  • To identify why the pro forma income statement and balance sheet must be reconciled
  • To identify the impact of mismanaging growth
  • To identify the concept of sustainable growth
  • To identify how compound growth techniques are best utilized
  • To recognize how regression analysis can be used in sales forecasting
  • To identify when best to use outside financing

PLEASE NOTE: CPE credit measurement is based on NASBA Registry and QAS guidelines of one credit for every 50 minutes. Credit calculation may vary in different states — check with your State Board of Accountancy. Unless otherwise noted in the specific course description, no advanced preparation is required in order to register or complete any PES CPE course. Use of materials or services provided by Professional Education Services, LP ("PES") are governed by the Terms and Conditions stated on PES' website www.mypescpe.com. PES provides these courses with the understanding that it is not providing any accounting, legal, or other professional advice and assumes no liability whatsoever in connection with its use. PES has used diligent efforts to provide quality information and material to its customers, but does not warrant or guarantee the accuracy, timeliness, completeness, or currency of the information contained herein. Ultimately, the responsibility to comply with applicable legal requirements falls solely upon the individual licensee, not PES. PES encourages you to contact your state Board for the latest information and to confirm or clarify any questions or concerns you have regarding your duties or obligations as a licensed professional.