Answer (B) is correct . The sales forecast drives all the other components of the operating budget. How much revenue the firm expects to bring in affects every other decision.
Answer (A) is incorrect because Instructor salaries will be addressed in the direct labor budget.
Answer (C) is incorrect because Since the capital budget spans multiple budget periods, it must be prepared outside the operating budget cycle and often must be approved by the board of directors.
Answer (D) is incorrect because The student recruiting budget is part of the marketing budget, which is prepared near the end of the operating budget process.
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