Which of the following statements is not correct? The revenue budget is the starting point in preparing the master budget. The revenue budget is constructed by multiplying the expected sales in units by the sales price. The production budget is not based on the revenue budget. The cash budget is used to determine whether the firm will have enough cash on hand.
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Which of the following statements is not correct?
-
The revenue budget is the starting point in preparing the
master budget . -
The revenue budget is constructed by multiplying the expected sales in units by the sales price.
-
The production budget is not based on the revenue budget.
-
The
cash budget is used to determine whether the firm will have enough cash on hand.
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
