Megan Espanoza, manager of the Wells Division of Mars, Inc., a large credit card company, recently received a memorandum describing the company's new budgeting process for the coming year. The new process requires Megan and the other division managers to submit a budget proposal outlining their operating plans and financial requirements. Management would then study the proposals and determine the budget for each division.

Required

a. What is this form of budgeting called?

b. What are the pros and cons of this approach? Explain.