Question 7 (7 points) Scanlon plan Knox Company manufactures consumer products such as cleansers, air fresheners, and detergents. During a recent quarter, the value of the products made was $100 million, and the labor costs were $6 million. The company has decided to use a Scanlon plan with this quarter being used to establish the base ratio for the plan. The formula is to be applied quarterly with differences, positive or negative, added to the bonus pool. The pool is to be distributed on a 35%/65% basis between the employees and the company at the end of the fourth quarter. The following production and cost levels were recorded during the first year of the plan's operation QUARTER PRODUCTION VALUE PAYROLL COSTS $90,000,000 $120,000,000 $110,000,000 $96,000,000 $4,950,000 $6,960,000 $7,150,000 $5,664,000 4 How much would be distributed to the employees at the end of the year? $96,000 $82,600 $110,000 $140,000