The manager starts with the sales objectives. Then he determines the task must be accomplished in order to achieve the objectives. if the cost are too high, the manager may inclined to find different ways to achieve the objectives until the management satisfied with both the objectives and the means of achieving them. Many firms use this method with some variations.

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Sales Budget:

It is revenue or unit volume anticipated from sales of the final products. It is the key budget and is based on the sales budget forecast management estimates the sales of each product may make separate forecast each segment.

Selling expense budget:

It anticipates various expenditure for personal selling activities e.g. Salaries, Commissions & other expenses for the sales forecast must be closely coordinated with the sales budget.

Administrative budget:

There may be several assistant sales manager, sale supervisors, sales trainers, sales department secretaries and office workers etc. Budgetary provisions must be made for their salaries and their staff, administrative budget must also budget for sales office operating expenses salaries, rent, power, light, office equipment and general overhead.

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