What are the disadvantages of incremental budgeting, Managerial Accounting

Assignment Help:

Disadvantages of incremental budgeting

a) Incremental budgeting suppose activities and method of working will continue in the same way

b) No incentive for developing their development new ideas

c) No incentive to decrease costs

d) Encourages spending up to the budget so that the budget is maintained next year

e) The budget may become out of date and no longer relate to the level of activity or type of work being carried out

f)  The priority for resources may have changed as the budget were originally set

g) There may be budgetary slack built into the budget which is never reviewed. Managers might have overestimated their needs in the past in order to obtain a budget which is simpler to work within and which will permit them to achieve favorable results.

 

 


Related Discussions:- What are the disadvantages of incremental budgeting

What are the factors which led to the development of abc, What are the fact...

What are the factors which led to the development of ABC: 1) Traditional costing fails to capture cause and effect relationship 2) Traditional costing often fails to highlig

Determine the cash flow budget - monthly cash disbursement, where can I get...

where can I get the solution for the question on this link: http://www.expertsmind.com/questions/determine-the-cash-flow-budget-monthly-cash-disbursement-30145416.aspx I have att

Career as a ceo, Q. Career as a CEO? Are you a leader Would you enjoy s...

Q. Career as a CEO? Are you a leader Would you enjoy sometime becoming the president or chief executive officer (CEO) of the company you work for after that you should consider

Seasonal variations and size of business, Seasonal Variations : Commodities...

Seasonal Variations : Commodities along with seasonal demand results in raised level of working capital requirement. It could be offset through scaling down operations throughout t

Illustration of short-term decisions, Illustration of short-term decisions ...

Illustration of short-term decisions These are, to a significant extent, determined by the excellence of the firm's long-term decisions. Illustration of short-term decisions in

Positioning, Positioning An essential part of the planning process is p...

Positioning An essential part of the planning process is positioning the organization to attain its goals. Positioning is a wide concept and depends on gathering and evaluating

Compute the operating cycle, Under this method, approximation is made of pa...

Under this method, approximation is made of payments and cash receipts in the ensuring period. The dissimilarity of these payments and receipts indicates deficiency or surplus of c

How much was Topaz’s operating income (income before taxes), How much was T...

How much was Topaz’s operating income (income before taxes) last year?

Point estimate of probabilities, POINT ESTIMATE OF PROBABILITIES This a...

POINT ESTIMATE OF PROBABILITIES This approach requires a number of different values for each of the uncertain variables to be selected. These might be values that are reasonabl

Explain the cost according to controllability, Explain the cost According t...

Explain the cost According to controllability: Controllable cost: this is a cost which can be inclined by the action of a specified member of an undertaking. The organization

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd