 In this discussion, we will discuss the discussion question of discuss why the budgeting process starts with the sales budget. So if you see an essay question or a discussion question like this, you could go into first what the budgeting process is, what are the components of the budgeting process, maybe able to pick up some points. First, a word from our sponsor. Well, actually, these are just items that we picked from the YouTube Shopping Affiliate program. But that's actually good for you. Because these aren't things that were just given to us from some large corporation, which we don't even use in exchange for us selling them to you. These are things that we actually researched, purchased and use ourselves. Bayer Dynamic? Not sure if I said that right, but this is the DT770 Pro 250 OHM Studio Reference Closed Back Headphones. I wear headphones basically every day for a large part of the day. They are important to me. Therefore, I've gone through many different kinds of headphones. I've had these for some time and they've worked quite well. They fit over my ears, but I'm still able to put my glasses on under the headphones. The headphones not pinching too tight on the glasses to give me a headache, which is nice. The quality of the patting is good and it has lasted for some time. I've had these for some time now and they haven't gotten all torn up on me or anything like that. I also like that I have a cord when I'm doing my recordings as opposed to a USB centered headphone because that frees up a USB port and I find the USB headphones to be less reliable. They come with an audio jack that looks like this, which is useful for me because that plugs into my audio interface. However, if you want to use the headphones for some other purpose, I believe it's fairly easy to get a converter to other types of audio jacks. If you would like a commercial free experience, consider subscribing to our website at accountinginstruction.com or accountinginstruction.thinkific.com where we have many different courses. You can purchase one at a time or have a subscription model, giving you access to all the courses, courses which are well organized, have other resources like Excel files and PDF files to download and no commercials. In that format, if you're an essay type question, then just going over the overview of the budget may pick up some points. If you're in a discussion type question, then you might look at a question like this, especially if someone else has already jumped into the discussion. You might say, oh, this is one of those questions where you might say, the question has been answered. I don't know what to do from here. But obviously you could go into the characteristics of budgeting and not focus so much on the sales budget part. You could say, well, expand on the budgeting part. There's a lot of different areas you can expand on. So you might want to start there. We could say, hey, here's what the budgeting process is. Go through the benefits of the budget, the budgeting process, and then discuss the order of the budgeting process. And you could actually list out, if you so choose, the order of the budgeting process. And then you can go through basically what one of the first things we do is, which is going to be the sales budget. Now, first of all, why do we have to have the budget in order? Because there's going to be some things that we need to know before we can do other pieces of the budget. And one of the first components we're going to need to know is what our projected sales are going to be. Because many of the other components that we're going to have are going to be dependent on that. If we think about things like direct material, direct labor that we're going to need to create inventory, how much inventory are we going to need to create? Well, that depends on how much we expect to sell. So we're projecting out into the future. If we're selling things like inventory, we need to know how much inventory we need, how much to produce, how much to purchase. The only way we could know that is to first know the sales items and the sales in terms of units, the sales in terms of dollars. And that, of course, is the first place we start then with the sales budget. So we can't really do much else before that. We have to have the projection on the sales budget. And note that could take some time because we're going to run a lot of what if analysis possibly on the sales budget, how much advertising should we have? Is it going to be different than last year, this year compared to last year? Once we have that, once we have that number, then we can construct the whole master budget type format with regard to the sales budget, with regard to the number of units that we will have with the sales budget.