Using the ________ Method for Setting an Advertising Budget,the Company

question 121

Multiple Choice

Using the ________ method for setting an advertising budget,the company starts with total revenues,deducts operating expenses and capital outlays,and then devotes some portion of the remaining funds to advertising.

• A)percentage-of-sales
• B)affordable
• C)competitive-parity
• D)objective-and-task
• E)moving-average

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Definitions:

Capital Assets

Long-term assets acquired for operation and not for resale, typically including buildings, machinery, and equipment.

Direct Method

A method of allocating service department costs directly to producing departments without considering interactions among service departments.

Operating Activities

Activities that constitute the primary or main activities of an organization, including sales, supply, and production functions, often reflected in the cash flow statement.

Indirect Method

A technique used in comprehensive cash flow statements, it adjusts net income for non-cash transactions and changes in working capital to calculate net cash from operating activities.