Concept explainers
Both the budget process and budgets themselves can impact management actions, both positively and negatively. For instance, a common practice among not-for-profit organizations and government agencies is for management to spend any amounts remaining in a budget at the end of the budget period, a practice often called ‘’use it or lose it” The view is that if a department manager does not spend the budgeted amount, top management will reduce next year’s budget by the amount not spent To avoid losing budget dollars, department managers often spend all budgeted amounts regardless of the value added to products or services. All of us pay for the costs associated with this budget system
Required
Write a half-page report to a local not-for-profit organization or government agency offering a solution to the “use it or lose it” budgeting problem.

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Chapter 22 Solutions
FUND ACCOUNTING PRINCIPLES BUNDLE
- Explain the concept of accounting cycles and their role in maintaining organized accounting records. What are the key considerations when establishing the length and timing of accounting cycles for different types of businesses? How do these cycles impact the timing of adjusting and closing entries?arrow_forwardProvide Answerarrow_forwardCan you solve this general accounting question with the appropriate accounting analysis techniques?arrow_forward
- Given solution for General accounting question not use aiarrow_forwardIf Transcend Corporation has a cash cycle of 42 days and an operating cycle of 105 days, what is its average payment period? a) 63 b) 42 c) 105 d) 147arrow_forwardWhat is the gross profit percentage for the current year?arrow_forward
- Cornerstones of Cost Management (Cornerstones Ser...AccountingISBN:9781305970663Author:Don R. Hansen, Maryanne M. MowenPublisher:Cengage Learning
