Which of the following statements is NOT correct concerning the Cash Budget?

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

 

The BRS Corporation makes collections on sales according to the following schedule:

30% in month of sale
65% in month following sale
5% in second month following sale
 

The following sales have been budgeted:

Sales
April $ 190,000
May $ 120,000
June $ 110,000
 

Budgeted cash collections in June would be:

Multiple Choice
$120,500
$110,000
$111,000
$110,950

 

The production budget is dependent on the Sales budget, desired ending units and beginning balance in units.

True or False