Which of the Following Budget Approaches Begins Each Year at $0

question 97

Multiple Choice

Which of the following budget approaches begins each year at $0 and each individual budget item must be justified?

• A)Dollar value-based budgeting
• B)Governmental-based budgeting
• C)Justification-based budgeting
• D)Zero-based budgeting

---

Definitions:

Working Capital

The difference between a company's current assets and its current liabilities, representing the short-term liquidity and operational efficiency of the company.

Fixed Assets

Long-term tangible assets that a firm uses in its operations and that are not expected to be consumed or converted into cash within a year.

Receivables

Money owed to a company by its customers for goods or services that have been delivered or used but not yet paid for.

Modified Accelerated Cost Recovery System (MACRS)

A method of depreciation used for tax purposes in the United States that allows businesses to recover investments in certain property over a specified life through annual deductions.