Home » Costing » _____________ is a detailed budget of cash receipts and cash expenditure incorporating both revenue and capital items.
Cash Budget
Capital Expenditure Budget
Sales Budget
Overhead Budget
Answer is Wrong!
Answer is Right!
The correct answer is: A. Cash Budget
A cash budget is a detailed plan that outlines a company’s expected
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cash inflows and outflows over a specified period of time. It is used to ensure that the company has sufficient cash on hand to meet its obligations and to make sound financial decisions.
A cash budget is prepared by forecasting the company’s cash receipts and cash disbursements for the upcoming period. Cash receipts are typically from sales, collections of accounts receivable, and other sources of income. Cash disbursements are typically for expenses, such as salaries, rent, and utilities.
The cash budget is a valuable tool for financial planning and control. It can help the company to avoid cash shortages and to make sound financial decisions.
The other options are incorrect because:
- A capital expenditure budget is a plan for how a company will spend its money on capital assets, such as buildings, equipment, and land.
- A sales budget is a plan for how much a company expects to sell in the upcoming period.
- An overhead budget is a plan for how much a company expects to spend on overhead costs, such as rent, utilities, and insurance.