Which of the following statements is true?
A)The direct materials purchases budget is determined from the direct labor budget.
B)The sales budget is the only budget based on an estimate of customer demand.
C)The capital expenditures budget are prepared from the production budget.
D)The selling and administrative expense budget is input into the forecasted cost of goods sold.

Question

Quizplus · Accepted Answer

The sales budget is the only budget that is based on an estimate of customer demand. The direct materials purchases budget is determined based on the production budget, the capital expenditures budget is prepared based on long-term planning and future planned investments, and the selling and administrative expense budget is prepared based on specific expenses related to non-production activities.

Which of the Following Statements Is True