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    1. How can a budget affect company morale? How could the budgetary process be made more beneficial to avoid any negative impact a budgetary concept can portray?

    2. How does contribution margin differ from controllable margin in a responsibility report for a profit center? How do controllable costs and non-controllable costs impact a manager's budget and decision making process?

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    Please find guidelines and ideas for Impact of Budget on Company Morale and Contribution Margin & Controllable Margin in the attached file.



    Answer 1
    Impact of Budget on Company Morale
    A budget has both positive and negative impact over company morale. The budget padding, in which management considers unrealistic targets, reduces the employee morale and consequently company morale. On the other hand, a budget with accurate targets and measures increases employees' effectiveness to perform their tasks that causes an increase in company morale. The bottom-up budgeting also provides benefits to the company in term of morale as it involves several people in making budgets (Sottini, 2009). On the other hand, top-down approach of budgeting process reduces ...

    Solution Summary

    The expert examines budgetary process being more beneficial to avoid any negative impacts.