A divisional manager's performance is evaluated on the basis of the difference between the sales revenues generated by that division and the cost of making those goods and services.On the basis of which of the following budget approaches is the divisional manager being remunerated?
A) Profit budget approach
B) Revenue budget approach
C) Cash flow budget approach
D) Cost budget approach
E) Expense budget approach

Question

Quizplus · Accepted Answer

In a profit budget approach, managers are evaluated on the difference between the revenues generated by the sales of goods and services and the budgeted cost of making those goods and services.

A Divisional Manager's Performance Is Evaluated on the Basis of the Difference