When Properly Performed,bottom-Up Budgeting Has the Disadvantage Of

question 35

Multiple Choice

When properly performed,bottom-up budgeting has the disadvantage of:

• A)a lack of detail needed in project plans.
• B)a lack of coordination among project managers and functional department heads.
• C)being a hindrance to top managers when prioritizing projects that are competing for the same scarce resources.
• D)a reduction of top management's control of the budget process to one of oversight.

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Definitions:

Residual Income

The net income an investment or project generates above the minimum required rate of return.

Required Rate Of Return

The minimum return an investor expects to achieve from an investment, given its risk level.

Responsibility Accounting

An accounting system that collects and reports planned and actual accounting information about the inputs and outputs of responsible parties.

Manager Control

The processes and procedures implemented by management to ensure that the organization's goals and objectives are achieved efficiently.