The desired level of ending inventory not independent, as it is used in the development of the production budget.
The budgeted income statement is a critical element of the master budget. It is one of the last budgets created from the operating budgets. The budgeted income statement is based on the sales budgets, expense budgets and other elements of the master budget, so it is not an independent item in the preparation of the master budget.
The budgeted statement of financial position (balance sheet) is based on a number of elements of the master budget including the budgeted income statement, so it is not an independent item in the preparation of the master budget.
The capital budget is the budget in which all capital (property, plant and equipment) expenditures are planned. This budget is not directly connected to the current period budgets and it is often prepared years in advance so that the company can plan to obtain the necessary financing or accumulate the necessary cash to carry out its capital expansion plans. The capital budget is often considered to be independent from the master budget.
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