Which of the following budgets would be prepared by both manufacturing companies and merchandising companies?
A) Production budgets
B) Direct material purchases budget
C) Sales budget
D) Manufacturing overhead budget

Question

Quizplus · Accepted Answer

Sales budgets are prepared by both manufacturing and merchandising companies, as they both need to forecast their sales to plan for future production or inventory needs. Production budgets and direct material purchases budgets are only prepared by manufacturing companies, while a manufacturing overhead budget is a specific budget related to the overhead costs incurred in the manufacturing process and would not be relevant for a merchandising company.

Which of the Following Budgets Would Be Prepared by Both