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? 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? $ (c) If the inflation rate this year is 0.7%, calculate the "adjusted" minimum wage rate (in $ per hour) to be paid next year. (Round your answer to two decimal places.) $ per hour
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? 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? $ (c) If the inflation rate this year is 0.7%, calculate the "adjusted" minimum wage rate (in $ per hour) to be paid next year. (Round your answer to two decimal places.) $ per hour
College Accounting (Book Only): A Career Approach
13th Edition
ISBN:9781337280570
Author:Scott, Cathy J.
Publisher:Scott, Cathy J.
Chapter7: Employee Earnings And Deductions
Section: Chapter Questions
Problem 2E
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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?
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?
$
(c)
If the inflation rate this year is 0.7%, 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.)
$
(e)
Suggest some ways that the restaurant chain or other small businesses can offset the increase in payroll and subsequent decrease in profit as a result of the minimum wage hike.
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(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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