When preparing the company's annual operating budget, the following budget must be prepared.
• Sales budget
• Production budget
• Budget for direct purchase of materials
• Direct Working Budget
• Overhead budget
• Selling and Administrative Expenses Budget
• End of inventory budget for finished goods
• Budget of the cost of goods sold.
What is the first component of a budget?
- The first component of the operating budget is the production budget.
- The sales budget is the cornerstone of the overall budget.
- The cash plan is created before the budgeted balance sheet is created.
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