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what is zero base budgeting

Answer Posted / govind

In zbb the budget is made from the scratch, as estimated in case of a new venture. This enables the managers in carrying the cost benefit analysis of individual activities of their respective decision units. This helps in neutralizing the discrepancies in normal budgeting process where sometimes a particular inaccuracy in a previous year’s budget is carried to the next year without evaluating its contribution to performance of the organization.

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