717 Which of the following is the first step in the budget p

7-17 Which of the following is the first step in the budget process? A. Cash receipts budget B. Direct materials budget C. Production budget D. Sales budget

Solution

Answer : D. Sales budget

=>  the first budget that is to be prepared under the Budgetary process is the sales budget because the production budget, Direct Material budget and all the other budgets including cash budget are derived from the sales budget. The sales budget guide the quantum/level/scale of each of other budgets.