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    A weakness of the percent-of-sales method to preparing a pro

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    A weakness of the percent-of-sales method to preparing a proforma income statement is ________
    (a) the assumption that the value of certain accounts can be forced to take on desired levels

    (b) the assumption that the firm faces linear total revenue and total operating cost functions

    (c) the assumption that the firm's past financial condition is an accurate predictor of its future

    (d) ease of calculation preparation.

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    (b) the assumption that the firm faces linear total revenue and total ...

    Solution Summary

    The solution highlights the weakness of the percent-of-sales method in preparing proforma income statements.

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