Which of the following is the reason behind designing zero-base budgeting as a control device?
A) To hide inefficiencies
B) To stop basing the present year's budget on the previous year's budget
C) To increase the rigidity in the budget
D) To distinguish between cash budgets and production budgets
E) To measure output

Question

Quizplus · Accepted Answer

Zero-base budgeting is designed to stop basing the present year's budget on the previous year's budget. The idea is to start from scratch and justify every expense rather than simply adjusting numbers from the prior year. This increases accountability and encourages a more thorough evaluation of each budget item.

Which of the Following Is the Reason Behind Designing Zero-Base