Which of the Following Statements Is Incorrect

question 3

Multiple Choice

Which of the following statements is incorrect?

• A) A service provider only prepares financial budgets, not operating budgets.
• B) A retailer prepares a budget for purchases and then a cost of sales budget.
• C) Both retailers and manufacturers prepare income, expense, capital expenditure and cash budgets.
• D) A manufacturer prepares a production budget, direct materials, direct labour and factory overhead budgets and then a cost of sales budget.

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Definitions:

Loan Payments

Regular payments made by a borrower to a lender to repay a loan according to the agreed-upon terms.

Financing Statement

A document that lists the names and addresses of all the parties involved in the transaction, a description of the collateral, and the signature of the debtor.

Perfect

In legal and financial contexts, to complete the necessary legal steps to secure a lien or claim on property as a security interest.

Collateral

Assets pledged by a borrower to secure a loan or other credit, and subject to seizure in the event of default.