Which of the following exists when managers deliberately underestimate revenues or overestimate costs to provide flexibility?
A)realistic standards
B)monetary incentives
C)budgetary slack
D)management by exception

Question

Quizplus · Accepted Answer

Budgetary slack occurs when managers intentionally overestimate expenses or underestimate revenues in the budget to create a cushion or flexibility to deal with unforeseeable issues. This can allow them to potentially exceed the budget and still appear to have performed well.

Which of the Following Exists When Managers Deliberately Underestimate Revenues