Sales budget must be prepared:

based on sales forecasts

I think the right answer is (c) Based on Sales forecasts of market.

(c) Based on Sales forecasts of market.

The Answer C

sure C cause production budget determines based on sales budget and ending inventory budget .

IT is c

Answer is Option C) Based on Sales forecasts of market.

both a & b 

Sales budget  are prepared based on   Sales forecasts of market taking into account 

  production capacity

This  is based on Sales and Market forecast

C) Based on Sales forecasts of market.

And its the base of the whole Budget.

C - is the answer