Which of the following represents the normal sequence in which the indicated budgets are prepared
A)Direct materials, cash, sales
B)Production, cash, income statement
C)Sales, balance sheet, direct labour
D)Production, manufacturing overhead, sales

Question

Quizplus · Accepted Answer

The production budget is typically prepared first as it drives the rest of the budgets. The cash budget comes next to ensure that there will be sufficient cash to fund operations. The income statement (or profit and loss statement) is then prepared to assess the profitability of the business based on the budgets.

Which of the Following Represents the Normal Sequence in Which