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patriot [66]
3 years ago
6

Grayson was employed as a field technician servicing building HVAC systems, but because of a downturn in the economy, he was lai

d off from his job. After unsuccessfully trying to secure another field tech position, Grayson finally took a job as a stock employee at Home Depot. Which of the following best describes Grayson's situation?A. Grayson is underemployed.
B. Grayson is seasonally unemployed.
C. Grayson has downsized.
D. Grayson has secured job enrichment.
Business
1 answer:
Bumek [7]3 years ago
6 0

The statement <u>A. Grayson is underemployed</u> best describes the Grayson's situation.

<u>Explanation</u>:

A person is said to be underemployed if he works for low wage or works for the job that does not make use of his skills.

Underemployment occurs due to excess of labor availability in-spite of work demand. The technological change may also cause underemployment. Underemployment causes due to decline in the economy.

In the above scenario, Grayson was underemployed due to downturn in the economy. He previously worked as a field technician but he was laid off due to decline in economy. Later he was appointed as stock employee at Home Depot.

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The SRT partnership agreement specifies that partnership net income be allocated as follows:
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Answer: Option (C) is correct.

Explanation:

Given that,

Partner S:

Salary allowance = $20,000

Interest on average capital balance = 10% of 60,000

                                                            = $6,000

Average capital balances for the current year = $60,000

Remainder = 30% of 50,000

                   = $15,000

Amount should be allocated = Salary allowance + Interest on average capital balance + Remainder

                                                = $20,000 + $6,000 + $15,000

                                                = $41,000

Partner R:

Salary allowance = $25,000

Interest on average capital balance = 10% of 50,000

                                                            = $5,000

Average capital balances for the current year = $50,000

Remainder = 30% of 50,000

                  = $15,000

Amount should be allocated = Salary allowance + Interest on average capital balance + Remainder

                                                = $25,000 + $5,000 + $15,000

                                                = $45,000

Partner T:

Salary allowance = $15,000

Interest on average capital balance = 10% of 40,000

                                                            = $4,000

Average capital balances for the current year = $40,000

Current year net income = $125,000

Remainder = 40% of 50,000

                  = $20,000

Amount should be allocated = Salary allowance + Interest on average capital balance + Remainder

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Workings:

Salary allowed = $20,000 + $25,000 + $15,000

                         = $60,000

Interest on average capital balance = $6,000 + $5,000 + $4,000

                                                            = $15,000

Total = Salary allowed  + Interest on average capital balance

        = $60,000 + $15,000

        = $75,000

Remainder = Current year net income - Total

                  = $125,000 - $75,000

                  = $50,000

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