The Volga is a manufacturing and trading company. The decision has been made by the management to start operation in the foreign country that has recently allowed foreign trade.
The company is planning of setting up a new sales and distribution office in a foreign location. The company has appointed Mr.Khalid as management Accountant and Mr. Salim as Sales manager. He has started meeting the customers. The company is in a process of setting a formal budget.
It has been suggested by the head office that a budget for the new operations should be produced using a participative approach. Currently the company is using the Imposed budgeting approach.
Explain the advantages and disadvantages of using the participative approach of budgeting, how it is different from the current approach of Imposed budgeting.
