Which of the Following Budgets Must Be Completed Before a Budgeted

question 7

Multiple Choice

Which of the following budgets must be completed before a budgeted income statement can be prepared?

• A) sales, cash, and cost of goods sold.
• B) sales, cost of goods sold, and operating expense.
• C) sales, operating expense, and cash.
• D)sales, cash, and balance sheet.

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Definitions:

Employee Stock Options

A type of compensation given to employees, offering the right to purchase company stock at a specific price within a set period.

Call Options

Financial contracts giving the buyer the right, but not the obligation, to buy a stock, bond, commodity, or other asset at a specified price within a specific time period.

Preferred Stock

A class of ownership in a corporation with a fixed dividend that is paid before any dividends are paid to common stockholders, typically without voting rights.

Common Stock

Shares of ownership in a corporation, giving holders voting rights and a share in the company's profits through dividends, subject to business performance.