Which of the following is not a characteristic of capital budgeting post-audits?
A) They provide feedback to managers regarding the soundness of their decision-making.
B) They encourage managers to build slack into capital investment proposals.
C) They are in-depth reviews of completed capital investment projects.
D) They use both financial and nonfinancial information.
E) They use only the actual results of the capital investment project.

Question

Quizplus · Accepted Answer

Capital budgeting post-audits are in-depth reviews of completed capital investment projects that use both financial and nonfinancial information. They provide feedback to managers regarding the soundness of their decision-making and use only the actual results of the capital investment project. However, they do not encourage managers to build slack into capital investment proposals. In fact, post-audits are used to evaluate the accuracy of initial estimates and assess the amount of slack built into the proposal.

Which of the Following Is Not a Characteristic of Capital