What is a key feature of fixed budgeting?

A key feature of fixed budgeting is that it projects expenditures and revenues at a set level, typically based on historical data or estimated figures for a specific period. This approach means that the budget remains unchanged regardless of variations in performance or actual income and expenses that occur throughout the fiscal period.

In a fixed budget, the focus is on establishing a set expenditure limit to guide financial decision-making. This allows organizations to maintain a clear understanding of their financial constraints and ensures that spending does not exceed the planned amounts. It facilitates accountability, as managers are responsible for managing within those fixed parameters.

While other options touch on aspects of budgeting, they do not accurately represent the core principle of fixed budgeting. The other choices highlight features that are more pertinent to flexible budgeting or adaptive financial planning, where adjustments are made based on performance, uncertainties, or cost-containment measures.