Question

Parker and Company pays Selma Stokes on a variable commission scale. In a month when Selma had net sales of $155,000, what was her Gross Pay based on the following scale?

Net Sales Commission Rate
Up to $40,000 5%
Excess of $40,000 to $75,000 5.5%
Excess of $75,000 to $100,000 6%
More than $100,000 7%

Answer 1

$9275

Explanation:

Selma earns 5% on the first $40,000, which is $2000.

She earns 5.5% on the next $35,000, which is $1925.

She earns 6% on the next $25,000, which is $1500.

And she earns 7% on the last $55,000 (the amount over 100,000), which is $3850.

Altogether, Selma's commission is ...

... $2000 +1925 +1500 +3850 = $9275.

_____

Comment on the sliding scale

Each of the segments of this sliding scale could be rewritten to simplify its computation. For example, for amounts above $100,000, the formula could be either of ...

• 7% of the amount over $22,500
• 7% of sales, less $1575.