If an employer offers a bonus to its employees equal to 5% of the company's annual net income, and the expected annual pre-bonus net income is $320,000, what bonus amount should be used in the year-end adjusting entry to record this benefit (rounded to the nearest whole dollar)?
A)$16,800.
B)$16,000.
C)$15,238.
D)$15,200.
E)$14.476.

Question

Quizplus · Accepted Answer

The bonus is calculated as 5% of the net income after the bonus. Let x be the bonus amount. Then, the equation is x = 0.05 * ($320,000 - x). Solving for x gives x = $15,238.

If an Employer Offers a Bonus to Its Employees Equal