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    Performance Evaluation: annual budget for American Tire Co.

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    The Akron plant of American Tire Company prepares an annual master budget each November for the following year. At the end of each year it compares the actual costs incurred to the budgeted costs. How can American Tire get employees to accept the budget and strive to meet or beat the budgeted costs?

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    Solution Preview

    There are several methods that can be instituted to encourage employees:

    1. Involve the employees in the budget process by soliciting their views of what are acceptable budget amounts. With this bi-directional level of communication, the employees (whether management ...

    Solution Summary

    The solution presents four possible methods that can be instituted to encourage employees to meet or beat the budgeted costs.