What are the pro forma financial effects of hiring a new employee given the multi-factor financial impacts of the hire?

Period or pro forma financial information

% Sales

Source

Period total sales:

Income Statement

Period Direct Job Costs (Cost of Goods Sold):

Income Statement

Gross Profit (Contribution Margin):

Period Fixed Costs (Operating and Overhead):

Income Statement

Calculate the total cost of hiring a new employee

Period base salary/wages of this employee ($):

Period anticipated bonus and retirement contribution as % of salary/wages:

Employment taxes (employER taxes, worker's comp, etc.) as % of salary/wages:

Period benefits (paid time off, vehicle, phone, etc) as % of salary/wages:

Total period cost to Company of hiring this employee ($X):

Financial effect of hiring a new employee

Previous period labor as % of direct job costs:

Income Statement or best guess

Previous period materials as % of direct job costs:

Expected period reduction in direct labor costs with this employee (▲YL%):

Better Sub Mgmt.

Expected period reduction in direct materials costs with this employee (▲YM%):

Better Mat. Control

Expected period increase in sales with this employee ($):

Expected period savings by bringing out-sourced work in-house ($):

Expected period reduction in G&A by increasing operational efficiency ($):

Period value of decreasing management administrative workload ($):

Total period benefit of hiring this employee:

Result of hiring new employee (at current Contribution Margin)

The additional overhead of a new employee will increase Period Fixed Costs to:

Break-even effect of hiring new employee (at current Contribution Margin)

Previous period Break-even Sales:

New Break-even Sales if you hire this employee:

Change from previous Break-even Sales if you hire this employee:

Analysis (at current Contribution Margin)

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