Excessive employee turnover can have multiple negative effects on an organization. List the various negative effects of excessive employee turnover and the costs associated with employee separation and vacancy.
What will be an ideal response?
Excessive employee turnover can have several negative effects on an organization. They include:
• Separation costs
• Training costs for new employees
• Vacancy costs
• Replacement costs
• Morale effects
The costs associated with employee separation are exit interview time, separation pay, and unemployment tax increase. The costs associated with vacancy are temporary help or overtime pay; productivity loss and service disruption.
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There is no need to make journal entries for the adjustments if the work sheet balances
Indicate whether the statement is true or false
For U.S. companies, how do U.S. GAAP and income tax reporting compare in their treatment of uncollectible accounts?
a. U.S. GAAP and income tax reporting both require the direct write-off method. b. U.S. GAAP and income tax reporting both require the allowance method. c. U.S. GAAP and income tax reporting require different treatments of uncollectible accounts. d. U.S. GAAP and income tax reporting assume uncollectible accounts are estimated based on past experience for reporting purposes. e. none of the above.
Prior to adjustment, the Allowance for Bad Debts account has a year-end debit balance of $500 . Estimated uncollectible accounts, based on an aging of the accounts receivable, total $6,200 . After the appropriate adjusting entry to recognize the bad debt expense, the Allowance for Bad Debts account should have a credit balance of:
a. $6,700 b. $5,700 c. $6,200 d. $6,100 e. None of the above are correct.
A company is considering purchasing a machine for $21,000. The machine will generate an after-tax net income of $2,000 per year. Annual depreciation expense would be $1,500. What is the payback period for the new machine?
A. 4 years. B. 6 years. C. 42 years. D. 14 years. E. 10.5 years.