Which of the following is a method used to prepare a budget?

Zero-based budgeting is a method that requires each department or area to justify its budget requests from scratch for each new period, rather than carrying over the previous year’s budget and making adjustments. This approach encourages a thorough examination of expenses, ensuring that all financial resources are allocated according to current needs rather than historical expenditures.

The process begins at a "zero base," meaning no budget is assumed, and every expense must be justified. By requiring this level of scrutiny, organizations can eliminate unnecessary expenditures and prioritize funding for activities or projects that align with current goals and objectives.

This method can lead to more efficient use of resources and encourages accountability, as managers must justify their proposed spending. It is particularly useful in situations where financial constraints exist, providing a more disciplined approach to budget preparation and resource allocation.