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Some cost items are more of a reflection of the strategy of the company and are not directly linked to revenue in a given period.

Some cost items are more of a reflection of the strategy of the company and are not directly linked to revenue in a given period. For example, some companies spend large amounts advertising their products or services. However, it is not easy to determine how much the revenue immediately rises due to the advertising cost, nor is it certain that revenue would immediately fall if the advertising budget was cut. Likewise, R&D spending is not likely to generate revenue in the near term, but it probably increases revenue in future periods. For Metropolis, sales and marketing expenses are expected to be 12 percent of revenue. With forecasted sales revenue of 220 for 2021, what will be the forecasted sales and marketing expenses for 2021?

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