Zero Based or Activity Based Budgeting?



Zero Based Budgeting
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Claire, England

Zero Based or Activity Based Budgeting?

If I use an incremental budget at current. Which am I best to start using as a replacement method, zero based budgeting or activity based budgeting?
 
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fda
American Samoa
 

Why not Use Both ABC and Zero Based Costing?

Hi Claire, It all depends on what you want to achieve:
- Activity based is fine if you just want to allocate budget and costs in a proper way.
- Zero based could be better if you want your company to really think why which budget is needed to reach your goals and have them think about alternatives.
But you also could use BOTH, using zero based to build up the relevant activities and then divide the budget over those activities.

   

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