Which of the following is not a consequence of budgetary slack?
A)Resources may not be allocated in the optimal way.
B)Those who implement the budget may engage in undesirable behavior because they had input into setting the budget.
C)Managers may receive bonuses they would not have earned if the budget had been prepared realistically.
D)The pro-forma budgets may not be representative of actual expectations.

Question

Quizplus · Accepted Answer

Budgetary slack refers to intentionally overstating budgeted amounts, resulting in a cushion for unforeseen events or expenses. This can lead to several consequences such as resources not being allocated in the optimal way, pro-forma budgets not being representative of actual expectations, and managers receiving bonuses they would not have earned if the budget had been prepared realistically. However, the implementation of a budget by managers who had input into setting the budget is not a consequence of budgetary slack. In fact, involving managers in the budget-setting process can increase their commitment to achieving the budgeted goals.

Which of the Following Is Not a Consequence of Budgetary