The number of units in the sales budget and the production budget may differ because of a change in ________.
A) ending finished goods inventory levels
B) total overhead charges for the year
C) beginning direct material inventory levels
D) sales returns and allowances

Question

Quizplus · Accepted Answer

The sales budget is typically based on expected customer demand, whereas the production budget takes into account ending finished goods inventory levels. If there is a change in the expected ending finished goods inventory levels, this will affect the production budget but not necessarily the sales budget.

The Number of Units in the Sales Budget and the Production