Question

When hired at a new job selling jewelry, you are given two pay options.

a. Base salary of $15,000 a year with a commission of 19% of your sales
b. Base salary of $20,000 a year with a commission of 5% of your sales
How much jewelry would you need to sell for option A to produce a larger income? (Round your answer to the nearest cent.)

Answer 1

$35714,29

Explanation:

Equate:

Base salary of $15,000 a year with a commission of 19% of your sales to

Base salary of $20,000 a year with a commission of 5%:

$15,000 + 0.19s = $20,000 + 0.05s

Combining like terms, we get: 0.14s = $5000, or s= $35714.29.

When the level of sales reaches $35714,29, the amount earned via each option will be the same. From that point on, Option A produces a larger income.