When preparing the cost of goods sold budget,________.

Question

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The cost of goods sold budget should start by calculating the projected cost to produce each unit. This will allow for an accurate determination of the cost of goods sold for the period. It is also important to consider the inventory costing method and any balances in Finished Goods Inventory when preparing the cost of goods sold budget. Multiplying units produced by the total projected cost per unit may not accurately reflect the actual cost of goods sold if inventory levels or costing methods are not taken into account.

When Preparing the Cost of Goods Sold Budget,________