Describe the process of preparing a master budget for a manufacturing company, including the steps involved in developing the sales budget, production budget, and cash budget. Discuss how these budgets are interrelated and their impact on financial planning and control.

The master budget is a comprehensive financial plan for an organization that encompasses various individual budgets. Explain the steps involved in preparing the sales budget, including forecasting sales volumes and revenues. Describe the production budget, detailing how it is derived from the sales budget and includes production costs and inventory requirements. Discuss the preparation of the cash budget, which outlines cash inflows and outflows. Explain how these budgets are interrelated, with the sales budget influencing production needs and cash flows, and their role in effective financial planning and control.