Which of the Following Budgets Must Be Completed Before Preparing

question 50

Multiple Choice

Which of the following budgets must be completed before preparing a cash budget?

• A)Capital expenditures budget.
• B)Rolling budget.
• C)Cash financing budget.
• D)Pro forma balance sheet.
• E)Pro forma income statement.

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Definitions:

Uncollectible

Refers to accounts receivable that are considered to be uncollectable and are thus written off as a bad debt expense.

Cash Receipts

The collection of money (currency, checks, wire transfers) by a business from its customers or other parties.

Inventory Purchases

The total cost associated with buying goods and materials kept in stock for the purpose of resale or production in a given period.

Administrative Expenses

Costs related to the general operation of a company, such as salaries of executive personnel, legal fees, and insurance.