Question: 1. Explain how forecasting to develop pro forma financial statements differs from forecasting for capital budgeting analysis. Provide enough information in your answers to demonstrate

1. Explain how forecasting to develop pro forma financial statements differs from forecasting for capital budgeting analysis.

Provide enough information in your answers to demonstrate your understanding, but do not feel obligated to fill the entire space or to provide information unrelated to the question. For some explanations, it may be sufficient to provide the equation used for the analysis together with an explanation of the meaning of the variables in that equation.

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