Examlex

Solved

What Is Budgetary Slack and Why Is It an Issue

question 24

Essay

What is budgetary slack and why is it an issue in budget preparation?


Definitions:

Pretax Income

The income earned by a business before any taxes have been deducted.

Target Pretax Income

The income a company aims to achieve before deducting taxes, often set for budgeting or goal-setting purposes.

Budgeted Income Statement

A financial report projecting revenue, expenses, and net income for a future period, based on management's expectations.

Degree of Operating Leverage

A measurement of how a company's operating income responds to a change in sales, indicating the level of fixed versus variable costs.

Related Questions