A Master Budget consists of A. Sales budget B. Production budget C. Material budget D. All of the above

The correct answer is: D. All of the above

A master budget is a comprehensive financial plan for a business that outlines the company’s sales, expenses, and capital expenditures for a specific period of time. It is typically prepared on an annual basis, but it can also be prepared on a quarterly or monthly basis.

The master budget is made up of a number of different budgets, including:

• Sales budget: This budget projects the company’s sales for the upcoming period. It is based on the company’s sales forecast, which takes into account factors such as the company’s target market, the economy, and the competition.
• Production budget: This budget projects the amount of product that the company needs to produce in order to meet its sales goals. It is based on the sales budget, as well as the company’s inventory levels and production capacity.
• Material budget: This budget projects the amount of materials that the company needs to purchase in order to meet its production goals. It is based on the production budget, as well as the company’s inventory levels and supplier contracts.
• Labor budget: This budget projects the amount of labor that the company needs to hire in order to meet its production goals. It is based on the production budget, as well as the company’s labor rates and productivity levels.
• Overhead budget: This budget projects the company’s non-production costs, such as rent, utilities, and insurance. It is based on the company’s historical costs and projections for future costs.
• Cash budget: This budget projects the company’s cash inflows and outflows for the upcoming period. It is used to ensure that the company has enough cash on hand to meet its obligations.
• Capital expenditure budget: This budget projects the company’s planned investments in new assets, such as equipment and buildings. It is used to ensure that the company has the resources it needs to grow.

The master budget is a critical tool for planning and controlling a business. It helps the company to set realistic goals, track its progress, and make necessary adjustments.