Question

A sales associate needs to earn $40,000. If expenses such as Social Security, Medicare, and operating expenses average 35% of gross income, what should the sales associate's goal be for gross income?

A) $25,000
B) $40,000
C) $61,538
D) $100,000

Answer 1

The sales associate's goal for gross income should be $61,538 (option C).

Step-by-step explanation:

To calculate the sales associate's goal for gross income, we need to consider the expenses such as Social Security, Medicare, and operating expenses that average 35% of the gross income. Let's assume the sales associate's goal for gross income is 'G'.

So, the net income after deducting expenses would be 65% of G, which is equal to $40,000. This can be written as:

0.65G = $40,000

To find the value of G, we can divide both sides of the equation by 0.65:

G = $40,000 ÷ 0.65 = $61,538