Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Household Brands Incorporated (HBI) manufactures household goods in the United States. The company made two acquisitions in previous years to diversify their product lines. In

image text in transcribed
image text in transcribed
image text in transcribed
Household Brands Incorporated (HBI) manufactures household goods in the United States. The company made two acquisitions in previous years to diversify their product lines. In 2011, HBI acquired cosmetics and consumer electronics companies. HBI is now, in 2022, comprised of three divisions: cosmetics, household, and consumer electronics. The following information in thousands of dollars) presents operating revenues, operating income, and invested assets of the company over the last three years: Operating Income Revenue Assets $ 23,300 25,300 21,700 $ 1,700 1,000 1,700 $ 9,600 8,000 9,200 Cosmetics 2020 2021 2022 Household 2020 2021 2022 Electronics 2020 2021 2022 Household Brands Total 2020 17,200 12,500 9,600 1,400 700 870 7,660 7,000 6,200 12,900 9,400 8,670 1,900 1,500 920 4,280 4,100 4,030 53.400 5.000 21.540 Household Brands Total 2020 2021 2022 53,400 47,200 39,970 5,000 3,200 3,490 21,540 19,100 19,430 The current compensation package is an annual bonus award. The senior executives share in the bonus pool. The pool is calculated as 20% of the annual residual income of the company. The residual income is defined as operating income minus a cost of capital charge of 15% of invested assets. The total amount of the bonus pool for 2020 is: Multiple Choice $67,000 $115,100 O $67,000. O $115,100. $211,800. $167,800. O $353,800

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Managerial Accounting For Decision Making

Authors: Seohee Park

1st Edition

B08HCQCN2G

More Books

Students also viewed these Accounting questions

Question

What is American Polity and Governance ?

Answered: 1 week ago

Question

5. Understand how cultural values influence conflict behavior.

Answered: 1 week ago