Question

Which budgeting method entails defining specific promotion goals, determining the necessary tasks, and estimating the costs to determine a promotion budget?
A) percentage-of-sales method
B) objective-and-task method
C) affordable method
D) exponential task method
E) competitive-parity method

Answer 1

Answer:

The question it self gives the answer away! The answer is B) objective-and-task method.

Explanation:

The objective and task method is very useful and has several advantages over the other forms of budgeting methods.

One is that you are setting your goals and determine which tasks are required to perform in order to achieve those goals.

This provides a clear strategy and a holistic approach to the employees and managers and save a lot of time while preventing future issues arising due to unpreparedness.

Moreover, as you have estimated the costs separately for each task, this can act as a benchmark to see eventually if you have succeeded or failed in achieving your targets.

However, a downside of this method is that if something unexpected occurs which is outside of your control (like a change in the market or economy), you might not have enough funds for it!