ECONOMICS
BUDGETING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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The first step involved in preparing a master budget is
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Preparing a forecasted income statement
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Preparing a general operating budget
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Preparing s forecasted statement of financial position
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Preparing s forecasted statement of financial position
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Explanation:
Detailed explanation-1: -The first step in preparing the master budget is the D) sales budget. Establishing the value of sales is the starting point of the budget. This is because all the firm’s operations will be based on the volume of the sales that needs to be achieved.
Detailed explanation-2: -The first step in preparing the master budget is the sales budget, which shows the planned sales units and the expected dollars from these sales.
Detailed explanation-3: -What is the starting point in the master budget process? The master budget process begins with compiling the sales budget.
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