
Concept explainers
Budget:
It is an estimated financial plan for future time period. It is used by management as an internal tool. It is prepared for a defined period of time.
To identify: Correct option.

Explanation of Solution
Option c, production budget is the correct option.
c.
Production budget is the plan that reports the units of merchandise to be produced by a manufacturing company during the budget period.
a.
Capital expenditure budget is a type of budget which states the value of long term assets purchased and timing of their purchase.
b.
d.
Manufacturing budget covers all
e.
Sales budget represents estimated number of units to be sold at expected selling price.
Thus, production budget is the plan that reports number of units to be produced by a company.
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Chapter 20 Solutions
FINANCIAL & MANAGERIAL ACCOUNTING
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