1) In which of the following aspects of business planning do Pro Forma Financial Statements play a key role? A) Communicating the business plan to stakeholders B) Collecting data required to formulate the businesses of options C) Evaluating and selecting the most suitable business option D) Setting the teams and objectives of the business E) Identifying the business options available to the business 2) The primary role of pro forma statements is to A) Model the external impacts on a course of action B) Predict the financial outcome of a course of action C) Allocate resources to business aims and objectives D) Represent the financial impact of courses of action E) Identify the financial gaps between clients and their implementation 3) The best way to apply the concept of operating leverage is to realize that A) High fixed costs compared to variable costs will always produce a higher EBIT B) Higher variable costs compared to fixed costs will always produce higher EBIT C) High fixed costs compared to variable costs will provide greater losses as sales decline than the reverse D) High variable costs compared to fixed costs will provide greater income as sales increase rather than the reverse E) High variable costs relative to fixed costs will provide greater losses as sales decline rather than the reverse