An unrealistic budget is more likely to result when it
A) has been developed in a top down fashion.
B) has been developed in a bottom up fashion.
C) has been developed by all levels of management.
D) is developed with performance appraisal usages in mind.

Question

Quizplus · Accepted Answer

An unrealistic budget is more likely to result when it has been developed in a top down fashion. This is because top level managers may not have the same level of knowledge and understanding of the operations and costs as front-line employees or managers. As a result, their budget estimates may be too optimistic or detached from reality.

An Unrealistic Budget Is More Likely to Result When It