 In this presentation, we will take a look at multiple choice questions related to budgeting, going through the questions, and then practicing test-taking skills with them. First question, which would be on a budgeted balance sheet? A. Advertising expense. B. Sales revenue. C. Cost of goods sold. D. Accounts receivable. Or E. All of the choices are correct. Let's go through this again using the process of elimination, which would be on a budgeted balance sheet. A. Advertising expense. Now the fact that it says expense would typically mean that it would be on the income statement. And note that although we're talking about a budgeted balance sheet here, most of the rules would generally apply. We'd have budgeted income and budgeted expenses on an income statement, budgeted assets, liabilities, and equity on the balance sheet. So, advertising expenses probably wouldn't be on the balance sheet. That would be an income statement item. B. Sales revenue. Once again, that's an income statement item, not a balance sheet item. So, that would typically not be there. C. Cost of goods sold. That too is an income statement item, not a balance sheet item. So, typically no. D. Accounts receivable. That's a balance sheet item typically. So, I would think it would be on the budgeted balance sheet if we're talking about budgeted accounts receivable. And the last one says all of the choices are correct, and we've eliminated three of them. And therefore, that is not the case. And it looks like D is our final answer. Final answer. Which would be on a budgeted balance sheet? D. Accounts receivable. Next question. Which is not completed before a cash budget is prepared? A. A capital expenditures budget. B. Sales budget. C. Merchandise purchases budget. D. General and administrative expense budget. And E. Budgeted income statement. So, let's go through this again using the process of elimination. Which is not completed before a cash budget is prepared? So, we have to do this which is not completed before we do the cash budget. We're imagining the order with which we do the budgets. We have to do the budgets in some type of order so that we don't get out of whack, out of sequence, and we do this in a systematic way. So, the cash budget is kind of near the end. We're at the like the lower third of the budgeting process. We're going to have to do a lot of stuff before the cash budget typically. Let's go through these and see which of these we would not have to do before the cash budget. In other words, what's kind of like the final stuff we got to do in the budgeting process? A. Capital expenditures budget. And it's not one of the first things we do, but I don't know if we do it before the cash budget. We'll have to keep it for now because you think we might capital by buying property plant and equipment and you would think maybe we use cash for that. So, maybe we'd have to do that before the cash budget. Let's keep that for now. The second one says the sales budget. Well, I know that's one of the first things we do. So, we definitely do that before the cash budget because that's like on the top of the list and cash budgets on the bottom. Third, C says merchandise purchase budget. And again, that's something we do pretty early on because we