 and then E says the cash budget and debt budget. Now that seems really reasonable except for the fact that we don't usually have you know a debt budget because it's not often we don't have another budget it's just the debt budget so we might have schedules to help us out with the with the debt budget. So the final answer is actually A on this one. So long-term liability data can be gotten from A the cash budget and capital expenditures budget. Next question. Which of the following must be prepared before the direct labor budget? A budgeted income statement. B cash budget. C capital expenditures budget. D production budget or E budgeted balance sheet. Let's go through this again using the process of elimination. Which of the following must be prepared before the direct labor budget either? A budgeted income statement. Now when we see a question like this once again we're thinking about the order of operations the order of the budgets we have to do all the budgets in a certain type of order in order to do them correctly otherwise we will have a mess and it starts with basically we have to start up with a sales type stuff happening first and then go through the order the end items that we're typically going to have are going to be the financial statements which would include the income statements. So which would have to be prepared before the direct labor budget? Well the direct labor budget is not the first thing we do it's somewhere in the middle but the income statement the budgeted income statement it's like the last thing we do so we're probably not going to be doing that before we have to do the the direct labor budget so I don't think it's going to be A. B says the cash budget and the cash budget's pretty close to the bottom again it's kind of like one of the later stuff we do so I would think that the cash budget probably not going to be done before the direct labor budget it's down close to the final product down close to the financial statements or the budgeted financial statements how about C capital expenditures budget and again that's getting kind of low down on the list here I'll keep that one for now but that's pretty down there D says the production budget so the production budget you know that's one's going to be a little bit higher up on the list we got to do that you know somewhat in the beginning of the process so that could quite possibly be it and E says the budgeted balance sheet and again that's kind of like the final product that's like at the end so we're probably not going to be doing the budgeted balance sheet before we do the direct labor budget that would be silly so now we're looking at C and D's between C and D if we just look at the order of operations you got the capital expenditures budget and the production budget usually we would do the production budget before the capital expenditure budget so the fact that the production budget is done after the cap the fact that the capital expenditures done after the production budget means that it's probably not the one and therefore the one would be D we're left with our final answer D and so that would be which of the following must be prepared before the direct labor budget D the production budget