1. The primary purpose of credit risk analysis is to ________.
identify credit opportunities
determine a company’s optimal capital structure
quantify potential credit losses
determine a company's weighted average cost of capital
provide information to banks about credit losses
2. When forecasting next year's balance sheet, what happens when the initial balance sheet projection reports estimated total assets greater than the sum of total estimated liabilities and equity?
The company expects to have excess cash available for investment purposes.
The company will need additional financing from external sources.
The company projected a loss.
The company will not be able to pay for expenses in the future.
None of these choices are correct.