 In this presentation, we will take a look at multiple choice questions related to budgeting. We'll go through the questions and then practice test taking skills with them. First question. First a word from our sponsor. Yeah, actually we're sponsoring ourselves on this one because apparently the merchandisers, they don't want to be seen with us. But, but that's okay whatever because our merchandise is better than their stupid stuff anyways. Like our trust me, I'm an accountant product line. Yeah, it's paramount that you let people know that you're an accountant because apparently we're among the only ones equipped with the number crunching skills to answer society's current deep complex and nuanced questions. If you would like a commercial free experience, consider subscribing to our website at accountinginstruction.com or accountinginstruction.thinkific.com. Report that presents estimated amounts of assets, liabilities and equity as of the end of the budget period is either a budgeted income statement, b continuous balance sheet, c budgeted balance sheet, d cash balance sheet or e operating balance sheet. Let's go through this again using the process of elimination. Report that presents estimated amounts of assets, liabilities, equity as of the end of the budgeted period. Now this question should be very familiar to us because in normal financial accounting as we go through it, this is clearly if you see assets, liability and equity, it should ring in your head that that should be kind of a balance sheet type of thing, right? So the balance sheet should kind of pop in your head, the main financial statement, balance sheet income statement type of thing, budgeted financial statements still have the same concept here because it's just now we're budgeting on either the balance sheet or the income statement. We're still finishing off with the financials, the balance sheet, the income statement, but now they are budgeted balance sheet and income statement. So that's what we would expect here. So let's go through them. A says a budgeted income statement. So it's not going to be the income statement because it's not revenue and expenses. B says continuous balance sheet. Now that has the keyword balance sheet that we're looking for. So I'll keep that for now. C says budgeted balance sheet. That's almost too plain for it to be correct, but it seems pretty good. And then D says the cash balance sheet. Notice they're using our key term and all these here, right? The balance sheet items. So that eliminates A, of course, the income statement. I'll keep that for now. And E says operating balance sheet. Again, they all seem like reasonable type terms in that they use the balance sheet. Let's go through it again. Reports that presents estimated amounts of assets, liability, and equity as of the end of the budget period is either A, continuous balance sheet, B, budgeted balance sheet, C, cash balance sheet or E, operating balance sheet. Now of those four, continuous balance sheet doesn't sound right to me. And then of the other three, operating balance sheet. That kind of sounds like maybe the normal operating type balance sheet and maybe not the budget balance. It doesn't really have a budget to it. Cash or budgeted balance sheet. Notice the balance sheet won't be typically, we might have a, when we think of budgeting in other words, we often think of a cash budget, but we're talking about basically on a cruel based budget balance sheet here. Although we will have a cash budget report. The balance sheet report will typically be on our normal kind of accounting standard. So it would be then C, final answer, budgeted balance sheet. One more time report that presents estimated amounts of assets, liabilities, and equity as of the end of the budget period C, budgeted balance sheet. Next, with a budgeted balance sheet, the amount for accounts receivable can be gotten from A, the purchases budget. B, the sales budget and the schedule of cash receipts. C, the capital expenditures budget. D, the budgeted income statement or E, the overhead budget. Going through this again, using the process of elimination. With a budgeted balance sheet, the amount of accounts receivable can be gotten from either A, the purchases budget. Now the purchases budget is us purchasing typically inventory, and that would be connected to, we would think accounts payable, stuff we owe, not accounts receivable, which we would consider to be connected with people owning us money, the customers. So I would think it not A, it would not be A. And then B says the sales budget and the schedule of cash receipts. Now the sales budget is something that I would consider, you know, that would be kind of linked to receivables, you would think, because we sell stuff to customers and if we sell it not for cash, then we get accounts receivable, it would go up. So that sounds like it could have possibilities. I'll keep that for now. We'll go to C, the capital expenditures budget. Now once again, we're expending money, not talking about people owing us money and capital expenditures are property, plant and equipment. So probably not C doesn't sound reasonable D says the budgeted income statement. And the accounts receivable, you know, we might think about when we got paid with an income statement because sales is on the income statement. So I'll keep that for now. And then he says the overhead budget. And we're probably we're not really talking about overhead here, typically, so it doesn't sound like that's going to be a receivable. So let's stick with B and D go through this again. With a budgeted balance sheet, the amount for accounts receivable can be gotten from either B, the sales budget and the schedule of cash receipts or D, the budgeted income statement. Of those two, I would think B sounds better, it's got the sales receipt, which is what we're looking for on the income statement. Because the other side of it, you know, and think about accounts receivable would be kind of sales, and then cash receipts, right? And B has sales, and it's got the schedule of cash receipts. So we know what the sales are. We know what we sold. And we know the amount that we got back from customers that could have paid on account paid off their receivables. So B seems like the final answer or will be our final answer. Let's go through it one more time with a budgeted balance sheet, the amount for accounts receivable can be gotten from B, the sales budget and the schedule of cash receipts.