Company a Uses a Heavily Participative Budgeting Approach Whereas at Company

Company A uses a heavily participative budgeting approach whereas at Company B, top management develops all budgets and imposes them on lower-level personnel. Which of the following statements is false?

A) A's employees will likely be more motivated to achieve budgetary goals than the employees of Company B.
B) B's employees may be somewhat disenchanted because although they will be evaluated against a budget, they really had little say in budget development.
C) Budget padding will likely be a greater problem at Company B.
D) Budget preparation time will likely be longer at Company B.
E) Ethical issues are more likely to arise at Company A, especially when the budget is used as a basis for performance appraisal.

Correct Answer:

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