A capital expenditures budget is prepared before the operating budgets.

Capital Expenditures Budget

A financial plan for a company's planned acquisitions of long-term assets, such as property, plant, and equipment, that are expected to provide benefits over many years.

Operating Budgets

Financial plans that outline projected income and expenses for a business over a specific period, typically one year, guiding daily decision-making.

Understand the sequential order and interdependence of different types of budgets within the master budgeting process.
Identify the purposes and impacts of both operating and capital expenditure budgets on financial planning.

Verified Answer

Anthony GreenMay 23, 2024

Final Answer :

False

Explanation :

The operating budgets are prepared before the capital expenditures budget because the operating budgets provide necessary details about expected revenues and expenses, which help in making informed decisions about capital investments.

Learning Objectives

Understand the sequential order and interdependence of different types of budgets within the master budgeting process.
Identify the purposes and impacts of both operating and capital expenditure budgets on financial planning.

A capital expenditures budget is prepared before the operating budgets.

Definitions

Learning Objectives

Learning Objectives

Related questions