Oakwood currently measures Mac's performance by comparing the cart rental operation's profit each month to the static budget. He gets a bonus if the operation earns more than the net income planned for the month?

 Assume Oakwood decides to start measuring Mac's performance by comparing the cart rental operation's profit each month to the flexible budget (based on the actual cart rental activity for the month) How will Mac's managerial behavior most likely change in the next few years?

Note: This does not ask specifically about flexible budgeting or how nice it will (or won't) be for Mac to be evaluated this way. How or what will be the most likely changes in Mac's managerial behavior (for example, will he be more motivated to sell carts, control costs, encourage his employees, push for more resources, and so forth)?

Answer rating: 100% (QA)

If Oakwood changes the way it measures Macs performance by comparing the cart rental operations profit to the flexible budget Macs managerial behavior ... View the full answer