Unless Properly Controlled,a "Bottom-Up" Budgeting Process Can Lead To

question 96

Multiple Choice

Unless properly controlled,a "bottom-up" budgeting process can lead to:

• A)Tight (i.e. ,difficult-to-achieve)budgets.
• B)Easy budget targets.
• C)Excessive downward communication.
• D)Reduced incentives for participation.
• E)Reduced budget preparation time.

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Definitions:

Comparative Financial Statements

Financial statements that provide a comparison of a company's financial performance and position over multiple periods.

Percentage Analysis

A financial analysis technique that expresses each item in a financial statement as a percentage of a base amount to identify trends and make comparisons.

Vertical Analysis

A method of financial statement analysis in which each entry for the various categories is represented as a percentage of a base figure.

Sarbanes-Oxley Act

U.S. legislation enacted in 2002, aimed at protecting investors from fraudulent accounting activities by corporations.