EasySleep Inn is a chain of medium-priced hotels. Each year during the budgeting process, the manager of each hotel in the chain has to submit a capital expenditure request, justifying the amounts of expenditure they request. Top management then makes a decision on whether to fund each capital expenditure request. This is an example of which purpose of budgeting?
A) Controlling profit
B) Allocating resources
C) Empowering employees
D) Evaluating performance and providing incentives

Question

Quizplus · Accepted Answer

The purpose of budgeting in this scenario is to allocate resources. The capital expenditure requests are evaluated to decide which hotels will receive funding and how much, based on their planned use of the funds. This helps ensure that resources are efficiently and effectively distributed to the hotels in the chain.

EasySleep Inn Is a Chain of Medium-Priced Hotels