How can establishing a pro forma early in a venture assist with determining viability of an...

How can establishing a pro forma early in a venture assist with determining viability of an entrepreneurial venture? Provide a specific example.

Expert Solution

Establishing a pro forma early in a venture assists with determining the viability of an entrepreneurial venture as it will help in making various projections for different fields like marketing, advertising, finance. Suppose a person name A has started his business venture if he will make pro forma it will help him to decide away. It will help him in reducing the overlapping of work. He can also review the entire venture and find out the points where he is lacking. It will help in checking the work or where he has reached. Pro Forma gives a basic idea of future losses and earning to an entrepreneur. For eg: Due to this pandemic situation the world will bear a loss of $30 billion. According to me, If an entrepreneur is having a loss, he can find numerous ways to cover that loss. It helps in comparing the results with the past scenario and measures to cover it. It also helps in finding an alternative. Pro Forma helps in calculating Liabilities and total cost. Estimating the total cash flows which gives you the status of your company.

keosha answered 3 months ago

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