Which of the Following Is Not a Characteristic of a Bottom-Up

question 83

Multiple Choice

Which of the following is not a characteristic of a bottom-up budget environment?

• A)Executive management creates the budget.
• B)At each higher level of management, the budget is reviewed and may be altered.
• C)The budget approach may also be referred to as participative budgeting.
• D)All of these answer choices are characteristics of a bottom-up budget environment.

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Definitions:

Fixed Manufacturing Overhead

Costs that do not vary with the level of production, such as rent, salaries, and insurance, associated with the manufacturing process.

Volume Variance

A measure in managerial accounting identifying the difference between planned and actual production volumes and its impact on the budget.

Unfavorable

Refers to an outcome or condition that is disadvantageous or against the interests of a person or entity.

Favorable

A term used in accounting and finance to indicate that actual costs were lower than planned or budgeted costs.