The production budgets are used to prepare which of the following budgets.
A) Operating expenses
B) Direct materials purchases, direct labor cost, factory overhead cost
C) Sales in dollars
D) Sales in units

Question

Quizplus · Accepted Answer

The production budget is used to calculate the quantity of goods to be produced during a period. This requires estimation of direct materials purchases, direct labor cost, and factory overhead cost which will be used to produce the goods. Therefore, option B is the correct answer. Operating expenses, sales in dollars and sales in units are not related to the production budget.

The Production Budgets Are Used to Prepare Which of the Following