Which of the following describes the inventory, purchases, and cost of goods sold budget?

Question

Quizplus · Accepted Answer

The inventory, purchases, and cost of goods sold budget focuses on managing inventory levels to ensure that a business has enough inventory on hand to meet demand without incurring excessive carrying costs.

Answer: B
 Capturing the variable and fixed expenses of the business is typically the focus of the operating budget.

Answer: D
 The cash budget helps a business plan to ensure that it has adequate cash on hand to meet its obligations as they come due. While the inventory, purchases, and cost of goods sold budget indirectly impacts cash by managing inventory levels, it does not directly focus on managing cash.

Therefore, the best choice is:
Answer: A

Which of the Following Describes the Inventory, Purchases, and Cost