What can cause a difference between the Cash budget and another budget?

Question

Quizplus · Accepted Answer

All the options listed can cause a difference between the cash budget and other budgets. Sales made to customers on account (A) and direct materials purchased on account (B) affect the cash budget when the cash is actually received or paid, not when the sale or purchase is recorded. Depreciation expense (C) is a non-cash expense and thus affects the income statement but not the cash budget. Prepayments for expenses such as rent (D) involve cash outflows that may not be expensed immediately in the income statement, affecting the timing in the cash budget versus other budgets.

What Can Cause a Difference Between the Cash Budget and Another