Develop a plan for the distribution of salary increases. Suppose you are employed in a local industry, and your supervisor has assigned you to distribute annual raises that must average 4% per department among 6 team members. No team member can get exactly 4%, and the raise must be at least 2% and no more than 6%.

You may establish your own criteria for distributing the raises, but you are given the years of experience and the rating on annual performance reviews for each member. A performance rating of 1 is the lowest rating possible and a rating of 5 is the highest.

Employee 1 has 4 years’ experience, a performance rating of 4, and a salary of $28,500.

Employee 2 has 3 years’ experience, a performance rating of 4, and a salary of $28,500.

Employee 3 has 10 years’ experience, a performance rating of 4, and a salary of $32,700.

Employee 4 has 7 years’ experience, a performance rating of 3, and a salary of $31,400.

Employee 5 has 15 years’ experience, a performance rating of 3, and a salary of $34,500.

Employee 6 has 12 years’ experience, a performance rating of 5, and a salary of $32,400.

Decide the amount of increase for each member.
1. Prepare your recommendations for your supervisor that includes the following:

a. A table showing the original salary, the amount of increase, the new salary, and the percent of increase for each employee. See Table Below
b. Show the calculations to verify that the total amount of increases is exactly 4% of the total original salaries except for rounding discrepancies.
c. Will the percent of change also average 4%? Why or why not? The overall percent of change does average 4%
d. What other factors could have been used to calculate pay raise? Goals set and met, training, education and attendance could be used.
e. Many feel that pay raises should reflect seniority only? Do you agree? Why or why not? I do not agree with using just seniority. If you are not performing and contributing to the group you do not deserve a raise based on the fact that you have been there longer than someone who works harder than you.

6 employees * 4% = 24 I used 24 to calculate the percent of wage increases. Total wages before raise is 188000 * 4% = 7520.00 to be divided up between the six employees. 188000 *7520 = 195520 If you round down my totals they meet the average quota. Original Salary

Amount of Increase

New Salary

Percent of Increase

28500.00

1111.50

29611.50

3.9%

28500.00

1083.00

29583.00

3.8%

32700.00

1471.50

34171.50

4.5%

31400.00

942.00

32342.00

3.0%

34500.00

1035.00

35535.00

3.0%

32400.00

1879.20

34279.20

5.8%

T-188000.00

T-7522.22

T-195522.20

T-24%

2. The interest formula shows how interest, rate, and time are related. It gives you a way of finding one of these values if the other three values are known. Even though you try to be careful in your calculations, there will always be that occasion when you make an error and end up with an incorrect answer. You can avoid such errors by first predicting what a reasonable answer might be by estimating. As an example, if you have an 11.2% interest, you could use 11% to estimate what the correct result would be.

Search the internet to find an application of simple interest that you find interesting, that you encounter on a daily basis or that you find in your profession.

Lowe’s often does a 6 or 8 month same as cash deal when you spend a certain dollar amount. I bought a washer and dryer that way. It was 1500.00 same as cash for 8 months if not the interest was 8.9% for 12 months. You know I paid it off by month 8.

1500/8=187.50 a month if I did not it would have been (1500) (0.89) (12) I=133.50 for 12 months

1500+133.50=1633.50 plus any finance charges they are likely to add on.

a. How could you avoid an error by using a pre-estimation? Present this application to the class and explain why you choose the example. When estimating a percentage round up.
b. In what ways do you use estimating in your everyday life? When I grocery shop I estimate how much I am spending and try to keep a running total by rounding up. I shop in the Ft. Meade Commissary so I do not pay sales tax but I do pay a 5% surcharge. I can also estimate what that will be ahead of time and subtract out my coupons.
Include the URL for the site you used. Do not copy the text in the site verbatim. You should summarize your findings.

http://www.lowes.com/cd_Lowes+Credit+Center+Apply+for+Credit+or+Pay+Your+Bill+Online_781778798_?storeId=10151&langId=-1&catalogId=10051