1. Which of the following describes the order in which the four types of budgets must be prepared?

a. Production, sales, direct materials purchases, cash received on account

b. Sales, production, direct materials purchases, cash budget

c. Cash receipts, direct labor, production, sales

d. Sales, direct materials purchases, production, cash disbursements.

2. The budget that adjusts unit sales for beginning and ending inventories of finished goods is the:

a. Production budget

b. Purchases budget

c. Ending inventory of finished goods budget

d. Cost of goods sold budget.