At the X-tron Sales Company, an employee's bonus is calculated using a

Question

At the X-tron Sales Company, an employee's bonus is calculated using a formula based on the profits for the company that year, the employee's sales record, and, in some cases, the performance rating of the employee's department. Departmental performance ratings are included at the management's discretion and are intended to encourage "team playing." Thus, they may have the effect of diminishing an individual employee's bonus, rather than increasing it.

If the statements above are true, a departmental performance rating would most likely have the greatest negative effect on the bonus for which of the following employees?

A) An employee whose department performed well and whose individual sales record was good in a year of low profits for the company.
B) An employee whose department performed excellently and whose individual sales record was exceptional in a year of high profits for the company.
C) An employee whose department performed poorly and whose individual sales record was exceptional in a year of high profits for the company.
D) An employee whose department performed well but whose individual sales record was poor in a year of high profits for the company.
E) An employee whose department performed poorly and whose individual sales record was poor in a year of high profits for the company.

nkme2007 · Answer

OA: C

If the employee gave his best sales,has good PAR and company has good profit then poor dept. Ratings may diminish his bonus despite such strong individual performance parameters.

Loser94 · Answer

a departmental performance rating would most likely have the greatest negative effect on the bonus for which of the following employees
E C
DP Bonus
So high sales of the employee but low sales of the department make bonus negative
A) An employee whose department performed well and whose individual sales record was good in a year of low profits for the company.
Incorrect both performed good mean employee gets a good bonus
B) An employee whose department performed excellently and whose individual sales record was exceptional in a year of high profits for the company.
Incorrect both performed good mean employee gets good bonus same as A
C) An employee whose department performed poorly and whose individual sales record was exceptional in a year of high profits for the company.
This may be the case Departmental rating have a negative impact on bonus-COrrect
D) An employee whose department performed well but whose individual sales record was poor in a year of high profits for the company.
it will have a positive impact -opposite -incorrect
E) An employee whose department performed poorly and whose individual sales record was poor in a year of high profits for the company
No impact or have a little impact -incorrect

Most Suitable Answer is C

SatvikVedala · Answer

Understanding Mathematically

condition (1) - Profits of Company AND Employees Sales record

condition (2) - Performance of Department

if ( Performance of Department ) is -ve (i.e. poor) => As per the argument "Departmental performance ratings may have the effect of diminishing an individual employee's bonus"

Also Diminishing Says Employee deserves the bonus (Sales = +ve & Profit of company = +ve) but he missed

Hence

if ((Performance of Department) == POOR){
....if (sales >= good AND Profit of company >= good){
.......return True
}
}
return False

cigarboy · Answer

Why is E not the OA?

My reasoning is: Sales of employee is poor as per option E and on top of it Department rating is poor. So, most negative effect on such employees.

GMATGuruNY · Answer

The correct answer must describe a case in which an employee who would normally receive a high bonus might instead receive a lower bonus because of a poor departmental rating.

E:  An employee whose department performed poorly and whose individual sales record was poor in a year of high profits for the company. 
Here, the employee's poor sales record would on its own yield a low bonus, regardless of the department's performance.
As a result, a low departmental rating has minimal impact.

C:  An employee whose department performed poorly and whose individual sales record was exceptional in a year of high profits for the company. 
Here, the employee's exceptional sales record would normally yield a high bonus, but the department's poor performance will likely diminish it.
As a result, a low departmental rating has greater impact.

Eliminate E and pick C.

slk00 · Answer

I marked A because it mentions that the department performance is only considered in certain cases.. why would it be wrong? Employee performance good (not exceptional as in other cases) and poor company performance would mean negative effect too right ?

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At the X-tron Sales Company, an employee's bonus is calculated using a

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