Which of the following would depict the logical order for preparing (1) a production budget, (2) a cash budget, (3) a sales budget, and (4) a direct-labor budget?

Question

Quizplus · Accepted Answer

The logical order starts with a sales budget (3) because it estimates the number of units expected to be sold, which informs the production budget (1) to determine how many units need to be produced. This then influences the direct-labor budget (4), which estimates the labor cost required for production. Finally, the cash budget (2) is prepared, incorporating all previous budgets to project the company's cash inflows and outflows.

Which of the Following Would Depict the Logical Order for Preparing