The Mathematics of Money

604

CHAPTER 15

SUMMARY

Topic Key Ideas, Formulas, and Techniques Examples

Gross Pay Based on Salary,

p. 581

• Divide annual salary by number of pay periods
  per year.


• Semimonthly is 24 times per year.


• Biweekly is 26 times per year in most years.

Jason earns a $25,900 annual

salary. He is paid biweekly.

Calculate his gross biweekly

pay. (Example 15.1.2)

Gross Pay Based on Hourly

Rate, p. 582

• Hours up to 40 per week are straight time; hours
  that exceed 40 per week are overtime.


• Multiply straight time hours by hourly rate.


• Multiply overtime hours by 1.5 times the hourly
  rate.


• Total straight and overtime pay.


• Some hours worked may also receive holiday
  pay or shift differential.

Dylan is paid $12.50 per hour.

In the fi rst week he worked

45.5 hours and in the second

he worked 24. Calculate

his pay for this pay period.

(Example 15.1.3)

Gross Pay Based on Piece

Rate, p. 583

• Multiply items produced by the piece rate.


• If rate varies with the number of pieces
  produced, calculate the pay for items at each
  rate level separately, then add to get the total.

Fraiser’s Tasty Land Acres

Farms pays strawberry

pickers on the basis of

the number of quarts of

strawberries they pick. The

pay scale, based on daily

production, is:

Quarts

Rate per

Quart

0–25 $0.65

26–75 $0.70

Over 75 $0.75

Mickey picked 82 quarts of

strawberries today. What is

her gross pay for the day?

(Example 15.1.5)

Gross Pay Based on

Commission, p. 584

• Multiply sales by commission rate.


• If commission rate varies by sales level, calculate
  commission at each rate level separately, then
  add to get the total.


• If a draw was taken, subtract it from the
  commission.

A fi nancial services company

pays its representatives a

commission on their monthly

mutual fund sales. The

commission schedule is:

Monthly

Sales

Commission

Percent

0–$10,000 1.25%

$10,000–

$25,000

1.75%

$25,000 2.15%

Ivan made $18,250 in mutual

fund sales last month.

Calculate his commission

from these sales for the

month. (Example 15.1.7)

(Continued)