What is the difference between controllable and uncontrollable spending?
(a) Controllable spending: items that Congress and the President can attach specific budgets to; uncontrollable spending: spending that Congress and the President have no direct control over.
What is uncontrollable spending?
• uncontrollable spending: budget. expenses that are either fixed by federal. law or are largely out of the government’s. control from year to year.
What is uncontrollable spending and give an example?
Social Security, Medicare and Medicaid are examples of entitlement programs that use large portions of the federal budget. Since the budget for these entitlements has risen faster than the tax revenue, these entitlements become uncontrollable expenditures.
Why is controllable spending called discretionary spending?
They become a part of the budget document- a part of the political statement- the President sends to Capitol Hill. What are entitlement programs? Why is controllable spending sometimes referred to as “discretionary spending?” They end the debate over the budget and prevent shut down.
Which of the following is an example of controllable spending?
trips, new cell phones, DVDs, etc. What are some examples of controllable spending? What is another name for uncontrollable spending? bills, car payments, insurance payments, cell phone bills, etc.
What are examples of uncontrollable cost?
Examples of uncontrollable costs are rent expense, the corporation overhead allocation, the administrative overhead allocation, and depreciation expense.
What are two example of uncontrollable items in the federal budget?
Answer Expert Verified Food stamps, medicare and social security are considered uncontrollable spending items in the federal budget.
Is uncontrollable spending uncontrollable?
How much spending is uncontrollable? Spending is generally said to be uncontrollable for political rather than legal reasons. Entitlement spending can always be controlled legally by reforming programs, but when an entitlement is extremely popular, reform may require more political courage than is readily available.
What are three examples of controllable spending?
bills, car payments, insurance payments, cell phone bills, etc. What are some examples of controllable spending? What percentage of federal spending is controllable? What percentage of federal spending is uncontrollable?
Why is Social Security spending considered uncontrollable in the US?
The laws establishing entitlements specify who is eligible and describe the benefits. The government then pays for as many eligible individuals as claim them. Thus, total entitlement spending cannot be predicted with precision from year to year—and is, in this narrow sense, “uncontrollable.”
What is a controllable cost?
Controllable costs are those over which the company has full authority. Such expenses include marketing budgets and labor costs. By contrast, non-controllable costs are those that a company cannot change, such as rent and insurance.
Are all cost controllable?
Generally, almost all direct costs such as material cost, labor costs, and certain overhead expenses are controllable by the actions of the lower levels of management. On the other hand, uncontrollable costs are not in control of the management. In fact, most fixed costs and overheads are uncontrollable costs.
What is controllable and uncontrollable cost?
The key difference between controllable and uncontrollable cost is that controllable cost is an expense that can be increased or decreased based on a particular business decision whereas uncontrollable cost is a cost that cannot be increased or decreased based on a business decision.
Which is the best definition of a controllable expense?
Controllable Expenses. Controllable expenses are ones that can be adjusted or “influenced” by someone. These are expenses that can be increased or decreased based on a retailer’s business decision.
Why are uncontrollable costs ignored in responsibility accounting?
Under responsibility accounting, managers are evaluated based on costs that they can control. Hence, uncontrollable costs are ignored in evaluating managers.
When are costs deemed to be controllable by an executive?
Once the policy renews and the executive has the power and authority to influence the policy along with its benefits, the costs are deemed to be controllable to that executive. The classification of controllable and non-controllable costs is especially important when evaluating management responsibility, performance, and compensation.