Budgeting for promotion expenditures by computing a percentage of past or expected sales:
A) is the most common method of setting the promotion budget.
B) is a complex method of budgeting.
C) will increase promotional expenditures when business is poor.
D) is especially suitable for new products.
E) None of these alternatives is correct.

Question

Quizplus · Accepted Answer

Budgeting for promotion expenditures by computing a percentage of past or expected sales is the most common and simple method used by most companies. It provides a reasonable estimate for promotional spending based on the company's past or expected sales volume.

Budgeting for Promotion Expenditures by Computing a Percentage of Past