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John Moffat.
John Moffat.-
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agnes222
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What are the main steps involved in preparing a zero?based budget?
1-Identifying previous inefficiencies, using adaptative management processes and avoiding wasteful expenditure in planning.
2-Recognising different cost behaviour patterns, planning on a rolling basis and ignoring wasteful expenditure.
3-Analysing the cost of each activity, identifying alternative methods and assessing the consequences of performing the activity at different levels.
4-Updating the budget continually, setting performance standards and controlling performance monthly with the use of variance analysis.
sir why is the answer not 1? the correct answer is 3
John Moffat
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Because the most fundamental idea of zero based budgeting is to consider alternative methods of performing the activity. ‘1’ does not mention this at all.
Please watch my free lectures for a full explanation.
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