A local government authority is considering a transition to Zero-Based Budgeting (ZBB) for its discretionary services (e.g., community outreach) due to severe funding cuts. Which of the following best describes a fundamental challenge the authority will face when implementing ZBB in this specific context?

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Accounting · Management Accounting

Verified Solution4 OptionsUpdated: October 2026👁️1 View

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Ranking decision packages will be difficult because the social benefits provided by these services are often qualitative and non-quantifiable.

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Answer 1

ZBB is only suitable for manufacturing environments where input-output relationships are clearly defined and measurable.

Answer 2

Incremental packages will only allow for a single 'base' level of activity, preventing the evaluation of different service levels.

Answer 3

Ranking decision packages will be difficult because the social benefits provided by these services are often qualitative and non-quantifiable.

Answer 4

The process will be unable to identify previous inefficiencies or obsolete operations because it starts from a 'zero base.'

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