Which of the following is usually prepared before the production budget?
A)direct materials purchases budget
B)direct labour budget
C)sales budget
D)cash budget

Question

Quizplus · Accepted Answer

The sales budget is usually prepared before the production budget because the production budget is based on the sales forecast. The sales forecast provides the information needed to determine how much of each product needs to be produced, which in turn affects the direct materials purchases and direct labour budgets. The cash budget is also usually prepared after the production budget, as it takes into account the cash inflows and outflows related to production and sales activities.

Which of the Following Is Usually Prepared Before the Production