Question

The primary disadvantage of incremental program budgeting is:
(A) It makes comparison from one year to the next difficult
(B) It requires the justification of all dollars allocated
(C) It requires far more time and effort than zero-based budgeting (ZBB)
(D) It may not reflect the current programmatic priorities of the organization

Answer 1

Answer: (D) It may not reflect the current programmatic priorities of the organization.

Explanation:

Explanation:

1. Incremental program budgeting involves making adjustments to the previous budget by adding or subtracting funds based on the previous year's budget rather than reassessing each program's needs from scratch.

2. This method may lead to funds being allocated based on historical patterns rather than current priorities or changing circumstances within the organization.

3. As a result, there is a risk that the budget may not align with the organization's current strategic goals and priorities, potentially leading to misallocation of resources.

4. In contrast, zero-based budgeting (ZBB) requires a justification for all dollars allocated, ensuring that resources are allocated based on the current needs and priorities of the organization rather than past spending patterns.