lynh manages a small company with 12 employees. he offers profit sharing where 5% of profits at end of year…

lynh manages a small company with 12 employees. he offers profit sharing where 5% of profits at end of year is distributed evenly to the employees. each employee earned $2,300 in profit sharing in 2013. what was the total profit?

lynh manages a small company with 12 employees. he offers profit sharing where 5% of profits at end of year is distributed evenly to the employees. each employee earned $2,300 in profit sharing in 2013. what was the total profit?

Answer

Explanation:

Step1: Find total profit - sharing amount

Since there are 12 employees and each earned $2300 in profit - sharing, the total profit - sharing amount is the number of employees times the amount per employee. $12\times2300 = 27600$

Step2: Calculate total profit

Let the total profit be $x$. We know that 5% (or 0.05) of the total profit $x$ is equal to the total profit - sharing amount. So we set up the equation $0.05x=27600$. To solve for $x$, we divide both sides of the equation by 0.05. $x=\frac{27600}{0.05}=552000$

Answer:

$552000$