The major problem associated with the _____ budgeting method is a reversal of the cause and effect relationship.
A)percent of sales
B)objective and task method
C)competitive parity
D)S-shaped response
E)rapidly diminishing returns

Question

Quizplus · Accepted Answer

The percent of sales budgeting method is based on a percentage of projected sales revenue, but this may lead to a reversal of the cause and effect relationship because sales can be affected by factors such as the budget itself or changes in the market, which makes it difficult to accurately predict and plan for expenses.

The Major Problem Associated with the _____ Budgeting Method Is