Question

A company has prepared the operating budget and the cash budget and is now preparing the budgeted balance sheet. While doing so, the Cash balance can be taken from the ________.

A) operational budget
B) budgeted income statement
C) cash budget
D) sales budget

Answer 1

The Cash balance needed for the budgeted balance sheet is taken from the cash budget, which provides the detailed projected cash position of the company. Thus, the option "C" is the correct answer.

Step-by-step explanation:

The Cash balance required for preparing the budgeted balance sheet can be taken from the cash budget. The cash budget details the company's expected cash inflows and outflows within a certain period and provides the projected cash position at the end of the period. It accounts for expected cash receipts from sales, cash disbursements for expenses, and financing activities. Hence, it is the best source for obtaining the ending cash balance that will appear on the budgeted balance sheet.