Question

the purpose of a pro forma balance sheet is to _______.

○ analyze the effects of a sales forecast

○ prepare for a financial audit

○ compare previous accounting periods

○ analyze historical data

Explanation:

A pro forma balance sheet is a projected financial statement. It helps in analyzing how a sales forecast (which drives revenue and related financial changes) impacts the company's financial position. Preparing for an audit, comparing past periods, or analyzing historical data are done with actual (not pro forma) financial statements. So the purpose of a pro forma balance sheet is to analyze the effects of a sales forecast.

Answer:

A. analyze the effects of a sales forecast