Answer (B) is correct . The budget process begins with the sales budget, proceeds to the production and expense budgets, and eventually the cash budget. The cash budget cannot be prepared until the end of the process because all other budgets provide inputs to the cash budget.
Answer (A) is incorrect because A direct labor budget must be prepared before the cash budget.
Answer (C) is incorrect because A?cost of goods sold budget must be prepared before the cash budget.
Answer (D) is incorrect because A manufacturing overhead budget must be prepared before the cash budget.
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