A firm hires only 5 employees annually but each for a compensation of $100,000 a year.Assuming it costs the company $12,000 to recruit one person,what is the company's staffing efficiency ratio?
A)10.2 percent
B)1)2 percent
C)21 percent
D)12 percent

Question

Quizplus · Accepted Answer

The staffing efficiency ratio is calculated as (Total Recruitment Costs / Total Compensation Costs) * 100. Here, Total Recruitment Costs = 5 * $12,000 = $60,000 and Total Compensation Costs = 5 * $100,000 = $500,000. So, the ratio is ($60,000 / $500,000) * 100 = 12 percent.

A Firm Hires Only 5 Employees Annually but Each for a Compensation