Indicate whether each of the following statements is true or false.A pro forma income statement provides a review of a company's profitability over the past year._____Budgets are usually prepared using spreadsheet software._____The pro forma statement of cash flows is essentially the same as the cash budget._____Pro forma financial statements must be prepared near the end of the budgeting process because they are affected by each of a company's budgets._____Once the master budget is prepared, company managers should continue to review the budget and adjust it for changes in assumptions or conditions._____
What will be an ideal response?
| A pro forma income statement provides a review of a company's profitability over the past year. | F |
| Budgets are usually prepared using spreadsheet software. | T |
| The pro forma statement of cash flows is essentially the same as the cash budget. | F |
| Pro forma financial statements must be prepared near the end of the budgeting process because they are affected by each of a company's budgets. | T |
| Once the master budget is prepared, company managers should continue to review the budget and adjust it for changes in assumptions or conditions. | T |
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