WGU D076 Finance Skills for Managers
ACTUAL QUESTIONS AND CORRECT
ANSWERS
Profit forecasting - CORRECT ANSWERS✅✅the projection of future earnings after all the
projected costs are subtracted from the projected sales
Balance Sheet Forecasting - CORRECT ANSWERS✅✅Using sales growth and the profit
forecast to construct a pro forma balance sheet to understand the future implications of the
sources and uses of finances
What is primary objective of the forecasting process? - CORRECT
ANSWERS✅✅Estimating the discretionary financing needed (DFN)
Discretionary Financing Needed (DFN) - CORRECT ANSWERS✅✅The additional
financing needed given a firm's expectations for future growth
What role does financial forecasting play in the future success and growth of a firm? -
CORRECT ANSWERS✅✅Financial forecasting supplements historical data with proposed
investments or changes to allow for more accurate foresight
What is the goal of financial forecasting? - CORRECT ANSWERS✅✅To understand the
implications of today's decisions on tomorrow's performance
Spontaneous accounts - CORRECT ANSWERS✅✅Accounts that vary proportionally with
sales
Discretionary accounts - CORRECT ANSWERS✅✅Accounts that do not vary
proportionally with sales but are decided upon by management
If a company expects sales to grow by 10% next year, which account might also increase by
10%? - CORRECT ANSWERS✅✅Cost of goods sold
ACTUAL QUESTIONS AND CORRECT
ANSWERS
Profit forecasting - CORRECT ANSWERS✅✅the projection of future earnings after all the
projected costs are subtracted from the projected sales
Balance Sheet Forecasting - CORRECT ANSWERS✅✅Using sales growth and the profit
forecast to construct a pro forma balance sheet to understand the future implications of the
sources and uses of finances
What is primary objective of the forecasting process? - CORRECT
ANSWERS✅✅Estimating the discretionary financing needed (DFN)
Discretionary Financing Needed (DFN) - CORRECT ANSWERS✅✅The additional
financing needed given a firm's expectations for future growth
What role does financial forecasting play in the future success and growth of a firm? -
CORRECT ANSWERS✅✅Financial forecasting supplements historical data with proposed
investments or changes to allow for more accurate foresight
What is the goal of financial forecasting? - CORRECT ANSWERS✅✅To understand the
implications of today's decisions on tomorrow's performance
Spontaneous accounts - CORRECT ANSWERS✅✅Accounts that vary proportionally with
sales
Discretionary accounts - CORRECT ANSWERS✅✅Accounts that do not vary
proportionally with sales but are decided upon by management
If a company expects sales to grow by 10% next year, which account might also increase by
10%? - CORRECT ANSWERS✅✅Cost of goods sold
