The term “budget slack” refers to the following (1 mark): a. Additional capacity available which can...
The term “budget slack” refers to the following (1 mark):
| a. |
Additional capacity available which can be budgeted for. |
|
| b. |
Extended lead time between the preparation of the functional budgets and the master budget. |
|
| c. |
Deliberate over-estimation of costs and under-estimation of revenues in a budget. |
|
| d. |
Difference between the budgeted output and the breakeven output. |
Homework Answers
OPTION C------Deliberate overestimation of costs and under estimation of revenues in a budget
Budget slack refers to deliberate overestimation of costs and under estimation of revenues in a budget.This is conservative approach of managers in creating budget where costs are overestimated and revenues are under estimated
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The term “budget slack” refers to the following (1
mark):
a.
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