As part of reconstructing excercise,a company reduced its work force by 30%.However,to motivate the remaining employees,a wage hike was given,The wages,on an average,increased in the ratio of 25:28.If the present wage bill per month is 4,90,000 what was the wage bill prior to the downsizing followed by the rise.
please help me out to solve this.
Ok. Lets take it step by step!
Lets assume the original work force = 1000 ppl.
Therefore, original wage bill = 1000 X Original Wage per person
Now since downsizing was 30%New workforce = 700 (1000-300)
Again, New wage bill for the company = 700 X New Wage per person
But this is given as $ 4,90,000
So. $4,90,000 = 700 X New Wage per personNew Wage per person = $700
Now the wages increased in the ratio of 25:28, which simply put means the ratio of the Old Wage to the New Wage is 25:28
=> New/Old =25/28
=> Old = 25/28(700) [Substituting the value of New Wage we just calculated]
=>Old Wage per person = $625
But wait, the question asks for the wage Original Wage bill
Therefore the ans is 1000 X 625 =$6,25,000
Confirm -> The ratio of the Old and New Wages -> $625/$700 = 25/28
& The New Wage bill -> $700 X 700 ppl = 4,90,000
Both are correct as per the question stem! Score !!!
Hope it helped