6. Case Study – Lightning Wholesale

Lightning Wholesale is a mid-to large-size company that works directly with manufacturers to bring sporting goods and equipment to mid to small-sized retailers.  The company is in Southern Ontario, Canada.  Lightning Wholesale acquires the goods, stores them in its warehouses, and distributes them to retailers, who then sell them to sporting enthusiasts across the province.  Suppliers are global, including those from the United States.

Lightning Wholesale is a dynamic office with global networking, communications, customer service, and complex workflows. Lighting Wholesale depends on its office professionals to support staff and management. Office Professional tasks include clerical support, bookkeeping, customer service, data analysis, and document processing.

Lightning Wholesale cares about its employees and retailers.  Where managers can assist their employees, they try to.  Where retailers need guidance, Lightning Wholesales tries to fill this gap as best they can. In working with its small retailers, many of which are owned and operated by sole proprietors, Lightning Wholesale assists the owners with their pricing to help develop promotional pricing plans and the amounts of the payments that can be advertised.  Lightning Wholesale freely offers help since it means more sales and increased profits for the company.

There are currently a few main tasks for Lightning Wholesale management:

• The payroll needs review for the past fiscal year.
• Costs and expenses need forecasting for the next fiscal year.
• Detailed analysis of office supply orders from quarter to quarter with recommendations for the next fiscal year.
• Forklifts need replacing in the warehouse.
• The next round of co-op students needs a computer.
• The employee appreciation event needs planning for next year.
• Travel expenses for the mobile team need to be summarized for the last fiscal year.

Questions

1. 1. If an employee earns a gross salary of $50,000 annually and the federal tax withholding rate is 20%, how much will be withheld for federal taxes from their monthly paycheck?
   2. An employee’s gross salary is $60,000 per year. If they contribute 8% of their salary to their RRSP (retirement savings), how much money will they contribute to the plan annually?
   3. Employees are eligible for a performance bonus of 5% of their annual salary. If the bonus amount is $2700, what is their annual salary?
   4. An employee’s monthly health insurance premium is $150. Their employer covers 75% of the premium cost. How much will the employee pay monthly for their health insurance?
   5. Lighting Wholesale needs to purchase a new forklift for the warehouse. The forklift they purchased 5 years ago was $170,000. A new forklift bought today is priced at 134.87% of the price of the forklift purchased 5 years ago. How much is the price of the new forklift? If they can sell the old forklift for $90,000, how much will they need to purchase the new forklift?