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Cseeman
07-05-2011, 06:10 PM
I am sorry for a second highly complicated post. I think i have finally let some of the assholes on DU get to me with thier insane "logic"

ok you have a made up corporation called A Corp. A Corp makes widgets and is a U.S. based company with 50,000 employees and 5.4 billion in sales (calculated below). A Corp has 30,000 employees working on manufacturing lines making widgets. wdigets can be made by one indivdual.
A Corp is a publically traded company and its average share price for the year is $5.00

a typical widget maker on A Corp manufacturing floor makes $20.00 per hour.
so if he works no overtime he makes (50 weeks * 40 hours = 2080 hours times $20.00 per hour= $41,600.

A single widget maker can make 5 widgets a day and widgets sell for $50.00 per widget.

360 days times 5 perday by each widget maker x 30,000 widget makers selling for $50.00 per widget equals 5.4 billion in revenue.

so a single widget maker makes 1,800 widgets per year and each widget sells for $ 50.00 so he basically generates $90,000 in revenue. his salary is $41.600 and lets add 10% for benefits. so his total cost is $41.600 times 1.10 = $45,760

so he generates $90,000 in revenue and costs $45.760 basically a return of 50% on investment.

A Corp has a CEO that makes 2.5 million in base salary. lets say he gets a 2% bonus on accounting net profits and also get 50,0000 shares of stock per year.

based on his strategic decisions the CEO of A Corp is responsible for generating 5.4 billion in sales.
his cost is 2.5 million plus lets say because of executive perks the percentage of his benefits are 20%

2.5 times 1.20 = 3.75 million

let's calculate his return 5.4 billion in revenue that costs 3.75 million is a net profit of 5 billion
is a great percent return on investment.

so in my book paying the Ceo 2.5 million to generate 5.4 billion in revenue and getting a 2000 times return on my investment makes alot more business sense then getting a 50% return on my investment.

SarasotaRepub
07-05-2011, 06:43 PM
So basically they are bitching again about high CEO salaries and how they aren't worth it but every slub in a factory shoud be making 50 bucs an hour??? :confused::D

Dan D. Doty
07-05-2011, 07:01 PM
Cseeman, I'm not picking on you, but have you been taking a lot business and accounting courses lately?

Cseeman
07-05-2011, 07:58 PM
Not anymore then usual.

I have been in a program where as at the completion of said program i will earn a PhD in Accounting for about a year now.

I also earned a Masters in Economics in 1996, Masters in Accounting in 2002 and an MBA in 2008. Also I have been a CPA since 1992.

I have a pretty extensive background in financial leadership having been a CFO for about 4 different companies.

I have not been a "steady" poster to this site over the time i have been a member here. Most of the time i come to this site just to read what is posted. I also spend time over at DU but i have been "banned" from posting there for sometime. However i stiill go over there just to read the postings.

That is a summary of me, hope that answered your question

djones520
07-05-2011, 08:42 PM
Cseeman. Read the rules of the forum.

http://www.conservativeunderground.com/forum505/showthread.php?t=41658

SarasotaRepub
07-05-2011, 09:15 PM
Cseeman. Read the rules of the forum.

http://www.conservativeunderground.com/forum505/showthread.php?t=41658


I was being nice. :p:D


But seriously Cseeman, you know how we do this forum so lets stick to it please.

Cseeman
07-05-2011, 09:27 PM
Sorry this was more of a rant against the people over at DU then a reaction to any specfic posting.

Cseeman
07-05-2011, 09:29 PM
Wow this is the first time i have been scolded since i left High School.......

SarasotaRepub
07-05-2011, 10:04 PM
:D:eek::D

Dan D. Doty
07-06-2011, 01:51 AM
Wow this is the first time i have been scolded since i left High School.......

You're not in trouble until you start liking the scoldings ... then its $200 an hour :D

Zathras
07-06-2011, 09:30 AM
Wow this is the first time i have been scolded since i left High School.......

http://www.abbagrace.com/webpics/nun_slapping_ruler_hg_clr.gif

michaelsean
07-06-2011, 02:59 PM
I am sorry for a second highly complicated post. I think i have finally let some of the assholes on DU get to me with thier insane "logic"

ok you have a made up corporation called A Corp. A Corp makes widgets and is a U.S. based company with 50,000 employees and 5.4 billion in sales (calculated below). A Corp has 30,000 employees working on manufacturing lines making widgets. wdigets can be made by one indivdual.
A Corp is a publically traded company and its average share price for the year is $5.00

a typical widget maker on A Corp manufacturing floor makes $20.00 per hour.
so if he works no overtime he makes (50 weeks * 40 hours = 2080 hours times $20.00 per hour= $41,600.

A single widget maker can make 5 widgets a day and widgets sell for $50.00 per widget.

360 days times 5 perday by each widget maker x 30,000 widget makers selling for $50.00 per widget equals 5.4 billion in revenue.

so a single widget maker makes 1,800 widgets per year and each widget sells for $ 50.00 so he basically generates $90,000 in revenue. his salary is $41.600 and lets add 10% for benefits. so his total cost is $41.600 times 1.10 = $45,760

so he generates $90,000 in revenue and costs $45.760 basically a return of 50% on investment.

A Corp has a CEO that makes 2.5 million in base salary. lets say he gets a 2% bonus on accounting net profits and also get 50,0000 shares of stock per year.

based on his strategic decisions the CEO of A Corp is responsible for generating 5.4 billion in sales.
his cost is 2.5 million plus lets say because of executive perks the percentage of his benefits are 20%

2.5 times 1.20 = 3.75 million

let's calculate his return 5.4 billion in revenue that costs 3.75 million is a net profit of 5 billion
is a great percent return on investment.

so in my book paying the Ceo 2.5 million to generate 5.4 billion in revenue and getting a 2000 times return on my investment makes alot more business sense then getting a 50% return on my investment.

None of that matters. A person's value is based on what they can be competantly replaced by. If a guy is willing and able to do your job for $15 an hour, then that is what your job is worth.

Cseeman
07-06-2011, 05:18 PM
I think you are completely incorrect.

The value of someone's labor is directly related to the value they bring to the market.

in this case the situation dictates that the value of a widget makers labor is $20.00

Madisonian
07-06-2011, 07:25 PM
I want to find the employee that only costs me 10% over their hourly rate.
With the SS match, FUTA, workman's comp, state UI, and the little odds and ends its typically closer to 20% right there and that does not include any benefits like vacation, health, pension or contribution matching, etc.
And then add in the overhead that must be covered like sales and marketing, accounting, inventory, and the rest of the crap.

This company will be broke in a year with these figures.

Cseeman
07-06-2011, 08:06 PM
I have made that calculation 1,000 in my career in both preparing budgets and strategic planning and that is roughly what benefits and taxes costs.

The difference between the real number and the 10% has never been large enough to make a difference.

Kay
07-06-2011, 08:56 PM
I have been in a program where as at the completion of said program i will earn a PhD in Accounting for about a year now.

I also earned a Masters in Economics in 1996, Masters in Accounting in 2002 and an MBA in 2008. Also I have been a CPA since 1992.

One can only imagine the extensive social life you must have......



I have a pretty extensive background in financial leadership having been a CFO for about 4 different companies.

That is a summary of me, hope that answered your question

Just one question remaining....are you single and available?
(please PM personal financial statements with reply ;))

Madisonian
07-06-2011, 09:03 PM
Check your math.
The widget maker is making 5 per day or 25 per week. (assuming your figure is based on a 40 hour week = 5 8 hour days) If he is working 360 days per year, then he is only working 5.55 hours per day (7 days a week with 5 total off for the year, not likely) based on your 2000 hours per year figure)
He works 50 weeks per year. (50 * 40 = 2000, not 2080)

50*25 = 1250 widgets per year per employee.
1250 * 30,000 manufacturing employees = 37.5 million units per year @ $50 per unit = 1.875 billion gross revenue. (A little less than 5.4 billion)

Your company is still going to go broke.

Madisonian
07-06-2011, 10:09 PM
If you have 50,000 employees and the average non-mfg wage is equal to the mfg wage (its usually more), then your gross payroll before the FICA, FUTA, etc. is 2 billion. Your gross revenue is 1.875 billion.
So your company is broke before it pays for material to make the widgets, a place to make them, taxes on all capital investments and so on and so on.

The board probably did pay the 2.5 mil to the CEO for bankrupting the company and the stock is basically worthless so might as well give him a million shares. Since you could not make payroll (you are 125 mil short), you probably did not make the 941 deposits and the IRS will be on your ass. Your vendors and suppliers have you in court, but you have no money to pay the attorneys and the bank has foreclosed on your property, holdings and collateral so I suggest a long trip to the Cayman Islands.

michaelsean
07-07-2011, 08:21 AM
I think you are completely incorrect.

The value of someone's labor is directly related to the value they bring to the market.

in this case the situation dictates that the value of a widget makers labor is $20.00

You can think what you want, but you will be wrong. Value is set by the market. If you make $20 an hour, and there are 1000 capable people willing to do your job for $15 an hour, then that is what your job is worth. And what about a janitor at the factory? He brings no value to the market. Are you saying his job is worth nothing?

It's no different than say a house. You can have 10 different appraisers say your house is woth $250,000, but if nobody is willing to pay you more than $200,000, then that's what your house is worth.

Cseeman
07-07-2011, 11:06 AM
it is very simple

if the market will pay $20.00 for a job that is the value of the job.

michaelsean
07-07-2011, 12:46 PM
it is very simple

if the market will pay $20.00 for a job that is the value of the job.


Are you acting like that's what you have been saying all along?

Madisonian
07-07-2011, 06:26 PM
Oh, by the way...
Even if each mfg employee produces 90,000 per year of product (which they don't) and you have 30,000 mfg employees, that is a gross revenue of 2.7 billion, not 5.4 billion.

The company however, is still broke.

Articulate_Ape
07-08-2011, 10:11 PM
I have been in a program where as at the completion of said program i will earn a PhD in Accounting for about a year now.

A) Neat. Are you any good at setting tables? You had better be.


I also earned a Masters in Economics in 1996, Masters in Accounting in 2002 and an MBA in 2008. Also I have been a CPA since 1992.

B) If that is true, which I'd bet my life it's not, then I am sad to say that you should refer to A).


I have a pretty extensive background in financial leadership having been a CFO for about 4 different companies.

C) If that is true, which I'd bet my life it's not, then I am sad to say that you should refer to B).


I have not been a "steady" poster to this site over the time i have been a member here. Most of the time i come to this site just to read what is posted. I also spend time over at DU but i have been "banned" from posting there for sometime. However i stiill go over there just to read the postings.

D) If that is true, which I'd bet my life it's not, then I am sad to say that you should refer to E).


That is a summary of me, hope that answered your question

You most certainly did and your intelligence beams through my dull mind like a laser. I want to thank you for your erudite and pedantic essay on this subject. I would only offer this shred of advice: If you choose to write, write what you know, and refer to D).




E) If you are going to lie, you had better know what you are lying about and have a good memory. You have been weighed, you have been measured, and you have been found lacking.

Next.

Madisonian
07-08-2011, 11:16 PM
A) Neat. Are you any good at setting tables? You had better be.



B) If that is true, which I'd bet my life it's not, then I am sad to say that you should refer to A).



C) If that is true, which I'd bet my life it's not, then I am sad to say that you should refer to B).



D) If that is true, which I'd bet my life it's not, then I am sad to say that you should refer to E).



You most certainly did and your intelligence beams through my dull mind like a laser. I want to thank you for your erudite and pedantic essay on this subject. I would only offer this shred of advice: If you choose to write, write what you know, and refer to D).




E) If you are going to lie, you had better know what you are lying about and have a good memory. You have been weighed, you have been measured, and you have been found lacking.

Next.

Hey, be nice.
Someone had to work for Enron, GM and Worldcom.:D