Question

Which of the following statements is NOT correct concerning the Cash Budget? Multiple Choice The Cash Budget should be prepared before the Budgeted Balance Sheet. The Cash Budget builds on earlier budgets and schedules as well as additional data. The Cash Budget should be prepared before the Budgeted Income Statement. It is not necessary to prepare any other budgets before preparing the Cash Budget.

Answer 1

Answer:

It is not necessary to prepare any other budgets before preparing the Cash Budget.

Explanation:

• The cash budget is assumptions of the cash flow over a period of time and this budget is used to check the entity has a sufficient cash to operate. This process allows the company to forecast the cash needs throughout the year and changes to the roll forwards this technique does need any other budgeting technique to be made prior.