In an effort to keep low-wage workers' salaries commensurate with the cost of living, a number of states have amended their constitutions to allow the minimum wage to be adjusted with inflation. You are the accountant for a company that owns a chain of 14 fast food restaurants in a state which adjusts the minimum wage for inflation. Each restaurant employs 25 workers, each averaging 20 hours per week at th current federal minimum wage, $7.25 per hour. (a) How many hours at minimum wage are paid out each week by the company? 7000 hr

FINANCIAL ACCOUNTING
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ISBN:9781259964947
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Chapter1: Financial Statements And Business Decisions
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In an effort to keep low-wage workers' salaries commensurate with the cost of living, a number of states have amended their constitutions to allow the minimum wage to be adjusted with inflation.
You are the accountant for a company that owns a chain of 14 fast food restaurants in a state which adjusts the minimum wage for inflation. Each restaurant employs 25 workers, each averaging 20 hours per week at the
current federal minimum wage, $7.25 per hour.
(a) How many hours at minimum wage are paid out each week by the company?
7000
hr
(b) At the current rate of $7.25 per hour, what is the amount (in $) of the weekly "minimum wage" portion of the restaurant's payroll?
$ 145
(c) If the inflation rate this year is 0.3%, calculate the "adjusted" minimum wage rate (in $ per hour) to be paid next year. (Round your answer to two decimal places.)
$
per hour
(d) How much in "additional wages" will the company have to pay out next year at the adjusted rate (in $)? (Round your answer to the nearest dollar.)
$
Transcribed Image Text:In an effort to keep low-wage workers' salaries commensurate with the cost of living, a number of states have amended their constitutions to allow the minimum wage to be adjusted with inflation. You are the accountant for a company that owns a chain of 14 fast food restaurants in a state which adjusts the minimum wage for inflation. Each restaurant employs 25 workers, each averaging 20 hours per week at the current federal minimum wage, $7.25 per hour. (a) How many hours at minimum wage are paid out each week by the company? 7000 hr (b) At the current rate of $7.25 per hour, what is the amount (in $) of the weekly "minimum wage" portion of the restaurant's payroll? $ 145 (c) If the inflation rate this year is 0.3%, calculate the "adjusted" minimum wage rate (in $ per hour) to be paid next year. (Round your answer to two decimal places.) $ per hour (d) How much in "additional wages" will the company have to pay out next year at the adjusted rate (in $)? (Round your answer to the nearest dollar.) $
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