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e) The budget may become out of date and no longer relate to the level of activity or type of work being carried out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

Calculate transfer price - management control system, Calculate Transfer Pr...

Calculate Transfer Price - Management Control System? Question: Compute the Transfer Price for Product X and Y and the Standard Cost of Product Z as the intra company pricing r

Mgt acc., company jobcosting system

company jobcosting system

Line of credit, It is a commitment by a bank to lend a specific amount of f...

It is a commitment by a bank to lend a specific amount of funds on demand identifies the maximum amount of unsecured credit the bank will allow the customer to borrow at any time.

Variables, Variables Unrestricted variable Yi can be expressed in terms...

Variables Unrestricted variable Yi can be expressed in terms of two non-negative variables by using the substitution: Yi = Yi' - Yi'', Yi', Yi'' ≥ 0 The substitution

Working capital management, A managerial accounting strategy focusing mainl...

A managerial accounting strategy focusing mainly on maintaining efficient levels of both components of working capital that is current assets and current liabilities, with respect

Dynamic programming, Dynamic programming It is an extension which finds...

Dynamic programming It is an extension which finds solutions to problems involving a number of decisions which have to be made sequentially. For example, the amount of a produc

Manufacturing overheard, different methods used to assign manufacturing ove...

different methods used to assign manufacturing overhead

Costing, Costing Cost accounting can be described as the collectio...

Costing Cost accounting can be described as the collection, interpretation of cost and assignment. In succeeding chapters, you will learn about alternative costing techniq

Decision making environment, Decision Making Environment There are four...

Decision Making Environment There are four main environments within that decisions can be done. These are: •    Certainty •    Risk •    Fundamental uncertainty •    Compet

Linear programming, what areas can linear programming be applied in manager...

what areas can linear programming be applied in managerial accounting?

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