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Head Corporation is a maker of ski and other outdoor sporting equipment. The company has three operating departments. John, Mary and Steve are managers in

Head Corporation is a maker of ski and other outdoor sporting equipment. The company has three operating departments. John, Mary and Steve are managers in each of these departments. The Company has recently instituted a revamped short term incentive plan, details of which are shown below. Calculate the annual bonus each employee.

Employee Helen Lisa Matt Goal
Salary 105,000 130,000 90,000
Target Incentive 25% 30% 20%
Component
Company 25% 30% 20% Net Income
Department 50% 50% 50% Divisional Net Income
Individual 25% 20% 30% Annual milestones
Target
Multipliers
< 80% 0% 0% 0%
80% - 99% 90% 90% 90%
100% - 125% 100% 100% 100%
>126% 120% 120% 120%
Actual results
Company 110% 110% 110%
Department 85% 110% 130%
Individual 120% 100% 75%

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