Question
Using the simple percent-of-sales method to prepare a pro forma income statement assumes all expenses remain fixed percentages of the sales revenue. Discuss the pros
Using the simple percent-of-sales method to prepare a pro forma income statement assumes all expenses remain fixed percentages of the sales revenue.
Discuss the pros and cons of this approach. For example, you may discuss the validity of assuming fixed expenses or interest expense as a fixed percentage of sales.
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Public Finance
Authors: Richard W. Tresch
4th Edition
0128228644, 978-0128228647
