Question

What are the different budgets that come together to form the Income Statement?

1) Sales Budget
2) Production Budget
3) DM Budget
4) DL Budget
5) MoH Budget
6) S&A Budget

Answer 1

The budgets that come together to form the Income Statement are Sales Budget, Production Budget, DM Budget, DL Budget, MoH Budget, and S&A Budget.

Step-by-step explanation:

The different budgets that come together to form the Income Statement include:

1. Sales Budget: This budget estimates the revenue from sales for a specific period.
2. Production Budget: This budget calculates the quantity of products to be produced based on sales forecasts and desired inventory levels.
3. Direct Materials (DM) Budget: This budget determines the quantity and cost of raw materials needed for production.
4. Direct Labor (DL) Budget: This budget estimates the labor costs required to produce the planned quantity of products.
5. Manufacturing Overhead (MoH) Budget: This budget includes indirect costs, such as utilities and maintenance, associated with production.
6. Selling and Administrative (S&A) Budget: This budget encompasses expenses related to sales and general administrative activities.