Benefits Plan Exercise Your job will be to design a compensation package for the Fitness 123 Company Fitness 123 spends $120,000 per year on its managers. The expenditure includes some salary, as well as appropriate choices of the fringe benefits listed below. Your task includes one major complexity you have managers in two different countries Specifically, there is a division in Adamskia and another in Manerus. Directons 1 Fill out the Compensation Package Worksheet, found below, describing the combination of salary and fringe benefits you would provide to workers in Adamskia and Manetur Description of Your Company Fitness 123 Your company runs luxury health clubs in medium to large cities. It charges $100 per month for a membership to its members. The marginal cost per customer per month is about $10 Many employees lead active, fitness-oriented, lifestyles, but there are significant exceptions...particularly among senior administrators. Approximately 60% of employees are married. Half of the married employees have at least 2 children. Description of the Countries Adauskie The income tax rate is a flat 20% on all income in Adamikia All money spent by a company for employee benefits is considered taxable with no exceptions. The government provides no national health insurance GDP per capita in Adamuskin is in the bottom third of all countries in the world Maneus For every dollar earned less than $100,000 must pay 10% of their income in tax, but for every dollar earned beyond $100,000 must pay 80% in tax. Most money spent by a company for employee benefits is taxable, but there are exceptions made for health insurance, dental insurance and vision care insurance. There is no national health insurance. GDP per capita in Manerus is among the highest in the world Possible Fringe Benefits Preferred Provider Organization Inc (PPO Inc) Health insurance This health insurance plan costs $2000 per month when the company buys it and $2,200 per month when a private individual buys it. It lets customers choose primary care physicians from a long list and provides very generous benefits for the insured and their families. This health insurance costs $1000 per month when the company buys it and S1,200 per month when a private individual buys it. Customers are assigned a doctor and that doctor must approve all subsequent care. Coverage for ordinary problems is generous, but coverage of unusual problems is spotty at best. Deductibles R Us This insurance pays for any health insurance expenditure above a $1000 deductible each year. It costs $1,200 per month when your employer buys it and the same when private individuals buy it. Fitness 123 This is your company. You could give employees free membership in Fitness 123. The company usually charpes $100 per month for this but the marginal cost of a membership is $10 HMO Inc Title 1 Normal 1 No Spac... Heading 1 Heading 2 Heading 3 A Paragraph Styles TUS SU ce pays 10 any car ane pune dove a SIVU UUUUUUre cucu yal. EUSES $1,200 per month when your employer buys it and the same when private individuals buy it. Fitness 123 This is your company. You could give employees free membership in Fitness 123. The company usually charges $100 per month for this, but the marginal cost of a membership is $10. Auto Liauki This company will rent cars to the company for $600 per month. Theying stylish, filled with leather and drive like a luxury tank. Their safety record is great. Cost to private customers is the same as what your employer would have to pay Auto Chegues This company will rent cars to the company for $400 per month, which is the same price they will rent them to private customers. The cars are clean, and officient, but fairly ugly Tooth 2000 The company will provide up to a maximum of $2000 per enrollee family member of dental care each year. They charge the company si00 per month per employee. Cost to private customers is the same as the company Dental Dynamo (DD) The company covers serious dental problems. It has a $800 deductible, but will cover any hon-cosmetic dentistry required. They charge $100 per month per employee. Cost to private customers is the same as your employer would have to pay Mark Entry Mark Citation Index Table of Authorities Compensation Package Summary Adamskia Manerus Division Division Type of Compensation Annual Cost to Annual Cost to Fitness 123 Fitness 123 Salary PPO Inc HMO Inc Deductibles R US Fitness 123 (Your Firm) Autoluxurious Auto Cheapus Tooth 2000 Dental Dynamo Other Total funds paid by Fitness 123 $120,000 $120,000 Employee's Taxable income** Employee's Taxes Paid Employee's after-tax income Describe anything you put in the other category in detail ** Some fringe benefits may not be subject to taxation while others are. For example, if a company spends $20,000 per year on health insurance (not considered taxable income in the US), $20,000 per year on a company car (considered taxable income in the US), and $80,000 in salary, then US taxable income is $100,000 Observation: Your company is spending $120,000 per year on each employee. If you add a fringe benefit then its cost must come out somewhere else. D Focus 6:08 PM 11/9/2020 Benefits Plan Exercise Your job will be to design a compensation package for the Fitness 123 Company Fitness 123 spends $120,000 per year on its managers. The expenditure includes some salary, as well as appropriate choices of the fringe benefits listed below. Your task includes one major complexity you have managers in two different countries Specifically, there is a division in Adamskia and another in Manerus. Directons 1 Fill out the Compensation Package Worksheet, found below, describing the combination of salary and fringe benefits you would provide to workers in Adamskia and Manetur Description of Your Company Fitness 123 Your company runs luxury health clubs in medium to large cities. It charges $100 per month for a membership to its members. The marginal cost per customer per month is about $10 Many employees lead active, fitness-oriented, lifestyles, but there are significant exceptions...particularly among senior administrators. Approximately 60% of employees are married. Half of the married employees have at least 2 children. Description of the Countries Adauskie The income tax rate is a flat 20% on all income in Adamikia All money spent by a company for employee benefits is considered taxable with no exceptions. The government provides no national health insurance GDP per capita in Adamuskin is in the bottom third of all countries in the world Maneus For every dollar earned less than $100,000 must pay 10% of their income in tax, but for every dollar earned beyond $100,000 must pay 80% in tax. Most money spent by a company for employee benefits is taxable, but there are exceptions made for health insurance, dental insurance and vision care insurance. There is no national health insurance. GDP per capita in Manerus is among the highest in the world Possible Fringe Benefits Preferred Provider Organization Inc (PPO Inc) Health insurance This health insurance plan costs $2000 per month when the company buys it and $2,200 per month when a private individual buys it. It lets customers choose primary care physicians from a long list and provides very generous benefits for the insured and their families. This health insurance costs $1000 per month when the company buys it and S1,200 per month when a private individual buys it. Customers are assigned a doctor and that doctor must approve all subsequent care. Coverage for ordinary problems is generous, but coverage of unusual problems is spotty at best. Deductibles R Us This insurance pays for any health insurance expenditure above a $1000 deductible each year. It costs $1,200 per month when your employer buys it and the same when private individuals buy it. Fitness 123 This is your company. You could give employees free membership in Fitness 123. The company usually charpes $100 per month for this but the marginal cost of a membership is $10 HMO Inc Title 1 Normal 1 No Spac... Heading 1 Heading 2 Heading 3 A Paragraph Styles TUS SU ce pays 10 any car ane pune dove a SIVU UUUUUUre cucu yal. EUSES $1,200 per month when your employer buys it and the same when private individuals buy it. Fitness 123 This is your company. You could give employees free membership in Fitness 123. The company usually charges $100 per month for this, but the marginal cost of a membership is $10. Auto Liauki This company will rent cars to the company for $600 per month. Theying stylish, filled with leather and drive like a luxury tank. Their safety record is great. Cost to private customers is the same as what your employer would have to pay Auto Chegues This company will rent cars to the company for $400 per month, which is the same price they will rent them to private customers. The cars are clean, and officient, but fairly ugly Tooth 2000 The company will provide up to a maximum of $2000 per enrollee family member of dental care each year. They charge the company si00 per month per employee. Cost to private customers is the same as the company Dental Dynamo (DD) The company covers serious dental problems. It has a $800 deductible, but will cover any hon-cosmetic dentistry required. They charge $100 per month per employee. Cost to private customers is the same as your employer would have to pay Mark Entry Mark Citation Index Table of Authorities Compensation Package Summary Adamskia Manerus Division Division Type of Compensation Annual Cost to Annual Cost to Fitness 123 Fitness 123 Salary PPO Inc HMO Inc Deductibles R US Fitness 123 (Your Firm) Autoluxurious Auto Cheapus Tooth 2000 Dental Dynamo Other Total funds paid by Fitness 123 $120,000 $120,000 Employee's Taxable income** Employee's Taxes Paid Employee's after-tax income Describe anything you put in the other category in detail ** Some fringe benefits may not be subject to taxation while others are. For example, if a company spends $20,000 per year on health insurance (not considered taxable income in the US), $20,000 per year on a company car (considered taxable income in the US), and $80,000 in salary, then US taxable income is $100,000 Observation: Your company is spending $120,000 per year on each employee. If you add a fringe benefit then its cost must come out somewhere else. D Focus 6:08 PM 11/9/2020