ABC company has 1,000 employees. The total annual base pay for all employees combined equals 58,500,000. Assume company's profit to be $50 million. Consider the following three formulas for determining the total profit sharing pool: 1. First-Dollar of Profits: The company agrees to share thre percent of all profits up to $25 million. 2. Graduated First-Dollar-of-Profits: The company agrees to share four percent of all profits up to $20 million, and six percent of all profits up to $45 million. 3. Profitability Threshold Formula: The company agrees to share five percent of all profits above $20 million up to $35 million. Calculate the total profit sharing pool for all three formulas noted below. T Total profits under "First-Dollar of Profits" formula is : Total profits under "Graduated First-Dollar-of-Profits" is : Total profits under "Profitability Threshold Formula" is :
ABC company has 1,000 employees. The total annual base pay for all employees combined equals 58,500,000. Assume company's profit to be $50 million. Consider the following three formulas for determining the total profit sharing pool: 1. First-Dollar of Profits: The company agrees to share thre percent of all profits up to $25 million. 2. Graduated First-Dollar-of-Profits: The company agrees to share four percent of all profits up to $20 million, and six percent of all profits up to $45 million. 3. Profitability Threshold Formula: The company agrees to share five percent of all profits above $20 million up to $35 million. Calculate the total profit sharing pool for all three formulas noted below. T Total profits under "First-Dollar of Profits" formula is : Total profits under "Graduated First-Dollar-of-Profits" is : Total profits under "Profitability Threshold Formula" is :
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![ABC company has 1,000 employees. The total annual base pay for all employees combined equals
$8,500,000. Assume company's profit to be $50 million. Consider the following three formulas for
determining the total profit sharing pool: 1. First-Dollar of Profits: The company agrees to share three
percent of all profits up to S25 million. 2. Graduated First-Dollar-of-Profits: The company agrees to
share four percent of all profits up to S20 million, and six percent of all profits up to $45 million. 3.
Profitability Threshold Formula: The company agrees to share five percent of all profits above $20
million up to $35 million.
Calculate the total profit sharing pool for all three formulas noted below. T
Total profits under "First-Dollar of Profits" formula is :
Total profits under "Graduated First-Dollar-of-Profits" is :
Total profits under "Profitability Threshold Formula" is :](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F907f9ddc-bca0-4f96-93e2-cb08edd499e0%2F9d81f420-3dce-4b53-a358-fe948262ee62%2Fijabwpq_processed.jpeg&w=3840&q=75)
Transcribed Image Text:ABC company has 1,000 employees. The total annual base pay for all employees combined equals
$8,500,000. Assume company's profit to be $50 million. Consider the following three formulas for
determining the total profit sharing pool: 1. First-Dollar of Profits: The company agrees to share three
percent of all profits up to S25 million. 2. Graduated First-Dollar-of-Profits: The company agrees to
share four percent of all profits up to S20 million, and six percent of all profits up to $45 million. 3.
Profitability Threshold Formula: The company agrees to share five percent of all profits above $20
million up to $35 million.
Calculate the total profit sharing pool for all three formulas noted below. T
Total profits under "First-Dollar of Profits" formula is :
Total profits under "Graduated First-Dollar-of-Profits" is :
Total profits under "Profitability Threshold Formula" is :
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