The practice of managers knowingly including a higher amount of expenditures (or lower amount of revenue) in the budget than they actually believe will occur is called:

Question

Quizplus · Accepted Answer

This practice is known as creating budgetary slack, which allows managers to have a cushion or safety net in case of unexpected expenses or events. By intentionally overestimating expenses, managers can make it easier to meet budget targets and potentially enhance their performance evaluation.

The Practice of Managers Knowingly Including a Higher Amount of Expenditures