Capital cost activity distribution

With the financial statement, one forecasts the operational performance needed to meet financial goals. A proforma" income statement is similar to a historical income statement. However, it projects the future rather than reports on past performance. This requires defining the supply chain activities needed to support the product. The range of assumptions is broad and will vary depending on the product. Examples are production, distribution, sales force, and revenues. If the product requires a new supply chain, this tool will set financial constraints for its design. Capital costs should be translated into operating costs using the tools described in Section 27.3.2. 

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