The percentage-of-sales budgeting method encourages management to think of the relationship among communication cost, selling price, and profit per unit.

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The percentage-of-sales budgeting method requires managers to allocate a fixed percentage of sales revenue towards various expenses, including communication costs. As a result, managers must consider the impact of communication costs on the selling price and ultimately the profit per unit.

The Percentage-Of-Sales Budgeting Method Encourages Management to Think of the Relationship