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Ch 4: Long-Term Financial Planning & Growth

About This Chapter

Learn the methods used by companies to plan their financial future based on projections. The lessons here were designed by experienced instructors who are available to answer your questions.

Long-Term Financial Planning & Growth - Chapter Summary and Learning Objectives

This chapter explores the fact that, in order to plan for their financial future, companies must rely on various methods of predicting what the future is likely to hold in store. Our lessons were designed with an eye for increasing comprehension and retention using a multiple-exposure approach. At the end of the chapter you should know about:

  • Financial planning: process and limitations
  • Various financial planning models
  • The percentage of sales method
  • External financing needed
  • Types of financial growth rates

Video Objective
The Financial Planning Process Discuss the purpose, dimensions, and limitations of financial planning.
Types of Financial Planning Models Examine multiple financial planning models including the sales forecast, pro forma statements, and economic assumptions.
The Percentage of Sales Method: Formula & Example Learn to calculate the percentage of sales and how it is used by financial planners.
How to Identify the External Financing Needed (EFN) Look into finding out how much money must be raised to achieve a goal.
Financial Growth Rates: Types & Determinants Discover different types of growth rates and what determines levels of growth.

5 Lessons in Chapter 4: Long-Term Financial Planning & Growth
Test your knowledge with a 30-question chapter practice test
The Financial Planning Process

1. The Financial Planning Process

Financial planning is essential for the success of any business. In this lesson, you'll learn about the financial planning process that businesses perform, including preparation of a master budget, capital budget and cash budget.

Types of Financial Planning Models

2. Types of Financial Planning Models

In this lesson, we'll discuss financial planning in business. We'll explore the use of models to create, implement, and evaluate financial plans. An example will be used to illustrate the concepts of the lesson.

The Percentage of Sales Method: Formula & Example

3. The Percentage of Sales Method: Formula & Example

Businesses need to forecast their sales growth on an annual basis and determine their borrowing needs. In this lesson, you will learn about the percentage of sales approach to financial forecasting.

How to Identify the External Financing Needed (EFN)

4. How to Identify the External Financing Needed (EFN)

It's important for businesses to think ahead about growth and financing needs. We'll cover three important formulas that will, in turn, cover when and how much external financing will be needed to accommodate growing the business.

Financial Growth Rates: Types & Determinants

5. Financial Growth Rates: Types & Determinants

Companies need to know how well they are doing and be able to measure aspects of their business to see their progress or lack of progress. In this lesson, we'll learn all about growth rate and how it pertains to a company.

Chapter Practice Exam
Test your knowledge of this chapter with a 30 question practice chapter exam.
Not Taken
Practice Final Exam
Test your knowledge of the entire course with a 50 question practice final exam.
Not Taken

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