Question

The _____ method of budgeting is being employed when expenditures are allocated by assigning a fixed amount of the unit product cost to promotion and multiplying this amount by the number of units sold.

Answer 1

The correct answer is letter "B": percentage of sales.

Step-by-step explanation:

The Percentage of Sales Method is an approach used at the moment of projecting the total amount of sales a company can process during the course of a year. This method aims to provide the firm with an idea of the sources necessary to produce enough output to meet its sales goal.

To forecast costs, the percentage of sales method allocates a fixed amount for a unit produced and then multiplies it by the number of sales projected.