The direct materials purchases budget is based on the production budget.

Name: The direct materials purchases budget is based on the production budget.
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Quizplus · Accepted Answer

The direct materials purchases budget is prepared based on the production budget because the direct materials needed for production are directly related to the number of units that need to be produced. Therefore, the production budget serves as a key input for the direct materials purchases budget.

The Direct Materials Purchases Budget Is Based on the Production