Question 1 · Easy
In zero-based budgeting, the nurse manager:
- AJustifies every expense afresh, as if starting from nothing
- BLets the budget change with the patient census
- CAdds a fixed percentage to last year's figures
- DPlans only for the purchase of major equipment
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Answer: A · Justifies every expense afresh, as if starting from nothing
Zero-based budgeting starts each budget period from zero, and every programme and expense must be justified again before money is given. It stops old, unneeded spending from carrying forward year after year. It takes more time to prepare than incremental budgeting. It is useful when funds are tight and priorities must be reviewed.
- B: A budget that changes with census or volume is a flexible budget.
- C: Adding a percentage to last year's figures is incremental budgeting.
- D: Planning for major equipment is the capital budget.