Answer
I disagree. Typically, the operating income budget is prepared before the cash budget. The operating income budget outlines expected revenues and expenses, providing the basis for estimating cash flows. Cash budgets follow, taking into account the timing of cash receipts and payments based on the operating income budget. This sequential order ensures that cash budgets are built upon the financial information provided by the income budget.
Work Step by Step
I disagree. Typically, the operating income budget is prepared before the cash budget. The operating income budget outlines expected revenues and expenses, providing the basis for estimating cash flows. Cash budgets follow, taking into account the timing of cash receipts and payments based on the operating income budget. This sequential order ensures that cash budgets are built upon the financial information provided by the income budget.