Suppose that a firm is considering hiring an employee whose wage would be $100 per hour. This employee's marginal product of labor (per hour) is 5 units and the good produced sells for $65 per unit. Will the firm hire the new employee? OYes ONO How much additional profit (or loss) will the firm generate by hiring this employee? (Make sure to add the negative sign if the firm faces a loss)
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- Artisan Metalworks has a bottleneck in their production that occurs within the engraving department. Jamal Moore, the COO, is considering hiring an extra worker, whose salary will be $55,000 per year, to solve the problem. With this extra worker, the company could produce and sell 3,000 more units per year. Currently, the selling price per unit is $25 and the cost per unit is $7.85. Using the information provided, calculate the annual financial impact of hiring the extra worker.At Stardust Gems, a faux gem and jewelry company, the setting department is a bottleneck. The company is considering hiring an extra worker, whose salary will be $67,000 per year, to ease the problem. Using the extra worker, the company will be able to produce and sell 9,000 more units per year. The selling price per unit is $20. The cost per unit currently is $15.85 as shown: What is the annual financial impact of hiring the extra worker for the bottleneck process?Florentino Allers is the production manager of Electronics Manufacturer. Due to limited capacity, the company can only produce one of two possible products: An industrial motherboard with a 75% probability of making a profit of $1 million and a 25% probability of making a profit of $150,000 A regular motherboard with a 100% chance of making a profit of $710,000 Florentino will get a 20% bonus from his department. Florentino has the responsibility to choose between the two products and is more of a risk-taker, more so than most of the top management at Electronics Manufacturer. A. Which option is Florentino more likely to choose and why? B. Which option would the company be more likely to choose and why? C. What changes should the company make to Florentinos compensation to avoid unnecessary risks?
- Garrison Boutique, a small novelty store, just spent $4,000 on a new software program that will help in organizing its inventory. Due to the steep learning curve required to use the new software, Garrison must decide between hiring two part-time college students or one full-time employee. Each college student would work 20 hours per week, and would earn $1 S per hour. The full-time employee would work 40 hours per week and would earn $15 per hour plus the equivalent of $2 per hour in benefits. Employees are given two polo shirts to wear as their uniform. The polo-shirts cost Garrison $10 each. What are the relevant costs, relevant revenues, sunk costs, and opportunity costs for Garrison?Carpetland salespersons average 8,000 per week in sales. Steve Contois, the firms vice president, proposes a compensation plan with new selling incentives. Steve hopes that the results of a trial selling period will enable him to conclude that the compensation plan increases the average sales per salesperson. a. Develop the appropriate null and alternative hypotheses. b. What is the Type I error in this situation? What are the consequences of making this error? c. What is the Type II error in this situation? What are the consequences of making this error?Ac Gems in the Rough, a jewelry company, the engraving department is a bottleneck. The company is considering hiring an extra worker, whose salary will be $56,000 per year, to ease the problem. Using the extra worker, the company will be able to engrave 8,000 more units per year. The selling price per unit is $16. The cost per unit currently is $11.85 as shown: What is the annual financial impact of hiring the extra worker for the bottleneck process?
- List the types of costs incurred when employees are laid off. What costs are difficult to estimate in monetary terms? Suppose that a firm is facing a downturn in business, each employee has skills valued at $40,000 per year, and it costs $100,000 to lay off an employee. If business is expected to improve in one year, are layoffs financially justified? What is the “payback” period for the layoff decision?Your company plans to hire an employee at a yearly salaryof $70,000. Someone in your company says the actual costwill be lower because of payroll deductions. Someone elsesays it will be higher. Who is right? What is likely to bethe total cost to the company? Explain.Joe Fixit has an appliance-repair business. He has more business than hecan handle and wants to hire another repair person. Joe estimates thatthree appliances can be repaired each hour by a qualified person. Joe billsout labor at $45 per hour, but he stipulates that the minimum charge forappliance-repair estimates is $30 plus parts. What is the marginal revenueproduct of a qualified repair person? What is the maximum hourly wagethat he would pay an employee?
- The sales manager is deciding between two possible compensation structures for sales staff. Under one plan, salespeople would receive a base compensation of $80,000 per year plus a 1% commission on all sales to their customers. Under the other plan, the base compensation would drop to $40,000 per year, but the commission rate would increase to 5%. What are the advantages and disadvantages, to the company of both plans? As the accounting manager, would you have a preference? Why or why not? (answer in text form please (without image), Note: .Every entry should have narration please)A potential supplier has offered to sell Reuben the rolls for $0.90 each. If the rolls are purchased, 30% of the fixed overhead could be avoided. If Reuben accepts the offer, what will the effect on profit be? Increase in profit of $1,600 if he buys the rolls Increase in profit of $1,200 if he buys the rolls Decline in profit of $1,200 if he buys the rolls Decline in profit of $1,600 if he buys the rollsThe Arthur Company manufactures kitchen utensils. The company is currently producing well below its full capacity. The Benton Company has approached Arthur with an offer to buy 10,000 utensils at $0.65 each. Arthur sells its utensils wholesale for $0.75 each; the average cost per unit is $0.72, of which $0.15 is fixed costs. If Arthur were to accept Benton's offer, what would be the increase in Arthur's operating profits?