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.