Pro forma statements for a proposed project should generally do all of the following except:
A) be compiled on a stand-alone basis.
B) include all project-related fixed asset acquisitions and disposals.
C) include all the incremental cash flows related to the project.
D) include taxes.
E) include interest expense.

Question

Quizplus · Accepted Answer

Pro forma statements for a proposed project should focus on the project's incremental cash flows, which include revenues and costs directly related to the project, taxes, and any changes in net working capital and capital spending. Interest expense is not included because it is a financing cost, and the analysis should be focused on the project's operational performance before financing considerations.

Pro Forma Statements for a Proposed Project Should Generally Do