Chapter 11-True/False and Multiple Choice Questions 11.1. True or False: A budget is one of the most powerful tools that an entrepreneur can use in planning business operations. False: The typical business will have cash inflows from three sources: cash sales, cash payments received on account, and loan proceeds. 11.3. True or False: The traditional accounting equation is: Assets Liabilities+ 11.4. True or False: Break-even analysis is used to tell how many units must be sold in order to break even at a particular selling price 11.5. Financial information is important to entrepreneurs because: A It pulls together all the information presented in other segments of the business. B. It quantifies all the assumptions concerning business operations C. It answers all questions about the business and the entrepreneur D. A and B are both correct The cash flow budget describes: A. Cash inflows/cash outflows. B. Cash outflows/accounts receivables. C. Interest income/interest expense. D. Profits/costs. 11.6. 11.7. A budget that is a statement of estimated income and expenses over a specified period of time is referred to as an: A. Anticipated Budget B. Operating Budget C. Entrepreneurial Budget D. Capital Budget. 11.8. Capital budgeting is designed to show A. If the entity should purchase anything B. Which project is most profitable C. Which of several mutually exclusive projects should be selected. D. How to evaluate projects based on rates of return