Mr. Holden's confusion arose from the fact that he had not expected the firm to report oss for the month of January. While he knew that sales had been down, primarily due to the normal seasonal downturn, and that production had been scaled back to help reduce the level of inventory, he was still surprised. He wondered if this first month's results were a bad omen in terms of the likelihood of meeting the budgeted results for the year (see Exhibit Even though the 1984 budget represented only a 10 percent inerease in sales volume over 1983, he was concerned that such a poor start to the year might make it difficult to get "back on stream