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Which of the following statement(s)is/are true about zero- based budgeting ? (Select the correct answer from the options below the statements) (1) It is costly to implement (2) It encourages every cost element to be justified (3) It encourages a questioning approach All of the above (1) only (1) and (2) None of the above

Question

Which of the following statement(s)is/are true about zero-
based budgeting ? (Select the correct answer from the
options below the statements)
(1) It is costly to implement
(2) It encourages every cost element to be justified
(3) It encourages a questioning approach
All of the above
(1) only
(1) and (2)
None of the above

Which of the following statement(s)is/are true about zero- based budgeting ? (Select the correct answer from the options below the statements) (1) It is costly to implement (2) It encourages every cost element to be justified (3) It encourages a questioning approach All of the above (1) only (1) and (2) None of the above

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Answer

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LucasVeteran · Tutor for 12 years

Answer

All of the above

Explain

## Step 1: <br />Each option and the related statement are verified against the proven facts about zerobased budgeting. <br /><br />## Step 2: <br />Statement (1) - "It is costly to implement"<br />Zerobased budgeting is notoriously intense on resources to plan since every expenditure needs to be justified, so this can lead to higher costs. Hence, the statement is true.<br /><br />## Step 3: <br />Statement (2) - "It encourages every cost element to be justified"<br />Zerobased budgeting indeed encourages every expenditure element to be validated every time the budget is set, starting from a "zero base". Therefore, the statement is correct.<br /><br />## Step 4: <br />Statement (3) - "It encourages a questioning approach"<br />Zerobased budgeting definitely promotes scrutiny of every budgeted cost as each expense requires justification before approval, thus nurturing a questioning approach. Accordingly, this statement is also true.
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