Assume Chester Corp. is downsizing the size of their workforce by 20% (to the ne

Question

Assume Chester Corp. is downsizing the size of their workforce by 20% (to the nearest person) next year from various strategic initiatives. Chester 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

A) $274,260

B) $1,097,040

C) $2,664,240

D) $666,060

HUMAN RESOURCES SUMMARY Baldwin 542 542 Chester 653 Digby 358 Needed Complement Complement 1st Shift Complement 2nd Shift Complement 393 179 123 Overtime% Turnover Rate New Employees Separated Employees Recruiting Spend Training Hours Productivity Index 0.0% 0.1% 18 642 5,000 0.0% 6.0% 32 107 $5,000 80 1 29.2% 0.0% 8.096 28 116 $2.500 0.0% 10.0% 85 50 117.4% 100.0% 118.1% $194 5535 5867 $1.595 5106 S3,210 Recruiting Cost Separation Cost Training Cost Total HR Admin Cost 385 78 50 5143 $100 5579 5287 5955 S3.780 Labor Contract Next Year 531.04 2.500 2.0% 5.0% $31.04 2.500 2.0% 5.0% $31.04 2.500 2.0% 5096 $31.04 2,500 2.0% 5.0% Wages Profit Sharing Annual Raise

Explanation / Answer

Downsize in existing workforce = existing workforce * 20% = 653*20% = 130.6 = 131

strengh of new work force = 653 - 131 = 522

seperation cost for the chester corp = new workforce * cost per employee = 522*(5000+100) = 2662200 (if rounded off)

If not rounded off answer is 2,664,240

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