Profit sharing is a method of employee compensation that
A)allocates an equal amount of profit reward to each manager in the organization.
B)allows organizational profits to be divided among employees in a non-taxable status.
C)is contingent based on the level of subunit profit generated.
D)is used in many foreign companies but is virtually nonexistent in most U.S.organizations.

Question

Quizplus · Accepted Answer

Profit sharing is a method of compensation that links pay to organizational performance. It is usually contingent on a specific subunit or department meeting or exceeding their profit targets. Profit sharing does not necessarily allocate an equal amount of profit reward to each manager in the organization, and it may or may not be taxed depending on the specifics of the plan. While it may be more prevalent in some foreign companies, it is also used by many U.S. organizations as a way to motivate and reward employees.

Profit Sharing Is a Method of Employee Compensation That