A common approach to budgeting line-items whereby the current year's budget is constructed by adding or subtracting amounts expected to be required by line items is:
A) Performance budgeting.
B) Zero-based budgeting.
C) Program budgeting.
D) Incremental budgeting.

Question

Quizplus · Accepted Answer

Incremental budgeting is a common approach to budgeting line-items whereby the current year's budget is constructed by adding or subtracting amounts expected to be required by line items based on the previous year's budget. This approach assumes that the previous year's budget is a good indicator of the amount required in the current year and allows for adjustments based on changing circumstances. Performance budgeting focuses on the outcomes of the budget, program budgeting focuses on the purpose of the budget, and zero-based budgeting starts from scratch each year.

A Common Approach to Budgeting Line-Items Whereby the Current Year's