Question

Assume Digby Corp. is downsizing the size of their workforce by 10% (to the nearest person) next year from various strategic initiatives. Digby   is planning to conduct exit interviews to learn more about how they can improve in processes and increase productivity. The exit interviews are estimated to cost $100 per employee in additional to normal separation costs of $5000. How much will the company pay in separation costs if these exit interviews are implemented next year?

Select: 1

$3,300,210 $150,990 $1,358,910 $366,690

HUMAN RESOURCES SUMMARY

Andrews Baldwin Chester Digby Needed Complement 603 421 732 719 Complement 603 421 732 719 1st Shift Complement 500 324 525 447 2nd Shift Complement 103 96 207 273 Overtime% 0.0% 0.0% 0.0% 0.0% Turnover Rate 6.9% 7.9% 5.9% 10.0% New Employees 42 33 43 72 Separated Employees 12 195 3 24 Recruiting Spend $5,000 $2,500 $5,000 $0 Training Hours 80 40 80 0 Productivity Index 107.3% 116.1% 128.5% 100.0% Recruiting Cost $249 $117 $259 $72 Separation Cost $60 $976 $14 $122 Training Cost $965 $337 $1,171 $0 Total HR Admin Cost $1,274 $1,429 $1,445 $194 Labor Contract Next Year Wages $31.04 $31.04 $31.04 $31.04 Benefits 2,500 2,500 2,500 2,500 Profit Sharing 2.0% 2.0% 2.0% 2.0% Annual Raise 5.0% 5.0% 5.0% 5.0% Starting Negotiation Position Wages Benefits Profit Sharing Annual Raise Ceiling Negotiation Position Wages Benefits Profit Sharing Annual Raise Adjusted Labor Demands Wages Benefits Profit Sharing Annual Raise

Answer 1

Present workforce of digby=719
downsizing amount=719*10%=71.9
New workforce=719-71.9=647.10
Seperation costs=(100+5000)*new work force
=5100*647.10=3300210
it is option A