Asked by Felicia Owunwanne on Jul 08, 2024
Verified
An overly optimistic sales budget may result in
A) increases in selling prices late in the year.
B) insufficient inventories.
C) increased sales during the year.
D) excessive inventories.
Sales Budget
A detailed projection of anticipated sales, used for planning and managing resources in a business.
Optimistic Sales Budget
A sales budget that is prepared with the expectation of achieving the best-case scenario in sales volume and revenue.
Excessive Inventories
Situation where a company holds a larger quantity of inventory than necessary, which can tie up capital and increase holding costs.
- Appreciate the impact of inaccurate sales forecasting on inventory and production planning.
Verified Answer
Learning Objectives
- Appreciate the impact of inaccurate sales forecasting on inventory and production planning.
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