The ________ method of developing a pro forma income statement forecasts sales and values for the cost of goods sold, operating expenses, and interest expense that are expressed as a ratio of projected sales.
A) percent of sales
B) accrual
C) judgmental
D) cash

Question

Quizplus · Accepted Answer

The percent of sales method is used to develop a pro forma income statement by expressing forecasted values for various expenses as a percentage of projected sales. This allows for a more accurate prediction of future income based on expected revenue.

The ________ Method of Developing a Pro Forma Income Statement