Question: Exercise 12-30 (Algo) Evaluating Management Control Systems-Ethical Considerations (LO 12-1, 3, 5, 7) 1 1 pot BOX Magnolia Manufacturing makes wing components for larg aircraft.
Exercise 12-30 (Algo) Evaluating Management Control Systems-Ethical Considerations (LO 12-1, 3, 5, 7) 1 1 pot BOX Magnolia Manufacturing makes wing components for larg aircraft. Kevin Cho is the production manager, responsible for manufacturing, and Michelle Michaels is the marketing manager. Both managers are paid a flat salary and are eligible for a bonus. The bonus is equal to 1 percent of their base salary for every 10 percent profit that exceeds a torget. The maximum bonus is 5 percent of salary. Kevin's base salary is $310,000 and Michelle's is $370.000 The target profit for this year is $8 milion, Kevin has read about a new manufacturing technique that would increase annual profit by 20 percent He is unsure whether to employ the new technique this year, wolt or not employ it at all Using the new technique will not affect the target Required: Suppose that profit without using the technique this year will be $8 million. By how much will kevin's and Michelle's bonus change if b. Suppose that profit without using the technique this year will be $10.5 million. By how much will kevin's and Michelle's bonus change i Kevin decides to employ the new technique? Complete this question by entering your answers in the tabs below. Required A Required Suppose that profit without using the technique this year will be 18 million By how much will Kevin's and Michelle's bonus change if Kevin decides to employ the new technique? (Enter your answers in dotars, not in millions Bonus Change Kevin's Michele
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