Which budgeting approach relies on budgets prepared by responsibility center managers?Question 38Answera.Flexible budgetingb.Incremental budgetingc.Zero-based budgetingd.Activity-based budgeting
Question
Which budgeting approach relies on budgets prepared by responsibility center managers?Question 38Answera.Flexible budgetingb.Incremental budgetingc.Zero-based budgetingd.Activity-based budgeting
Solution
The budgeting approach that relies on budgets prepared by responsibility center managers is c. Zero-based budgeting. In this approach, all expenses must be justified for each new period. The process starts from a "zero base" and every function within an organization is analyzed for its needs and costs.
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