Which statement is most likely true about the affordable method of setting an advertising budget?
A) Spending on advertising is calculated based on the financial objectives a company wishes to accomplish.
B) Spending on advertising is calculated after operating expenses and capital outlays are deducted from total revenues.
C) Spending on advertising is based on a predetermined percentage of current or forecasted sales for the year.
D) Spending on advertising is calculated as a percentage of the unit sales price.
E) Spending on advertising is based on a competitor's advertising outlays.

Question

Quizplus · Accepted Answer

The affordable method involves setting the advertising budget based on what a company can afford after covering operating expenses and capital outlays.

Which Statement Is Most Likely True About the Affordable Method