Which of the following is not true about the direct materials purchases budget?
A) It is determined by the anticipated change in the direct materials inventory level and the production budget.
B) The direct materials purchases budget does not affect the forecasted balance sheet.
C) The direct materials purchases budget is expressed in units and dollars.
D) It is used in preparing the budgeted income statement.

Question

Quizplus · Accepted Answer

The direct materials purchases budget does affect the forecasted balance sheet, as it is used to calculate the anticipated ending inventory of materials, which is a current asset on the balance sheet. Therefore, statement B is not true.

Which of the Following Is Not True About the Direct