Top-down budgeting refers to
A) a budgeting system that begins with sales forecasts and works downwards to the raw materials budget.
B) a budgeting systems that begins with budgeting the facility-level costs.
C) a budgeting system where senior managers impose budget targets on junior managers.
D) a budgeting system where there are frequent communications between top and bottom managers.

Question

Quizplus · Accepted Answer

Top-down budgeting is a budgeting system where senior managers impose budget targets on junior managers. This approach assumes that senior management has a better understanding of the big picture and the strategic goals of the organization, and can set appropriate targets for each department or division. It can help to ensure that budgets are aligned with strategic objectives but can lead to less participation from lower-level managers who may feel less ownership over the budget.

Top-Down Budgeting Refers to