Question

Hartwell Manufacturing pays all sales representatives 5% commission on the first $17,500 of their individual sales and 9% commission on their individual sales in excess of $17,500. Assume that Janet Roberts sold merchandise valued at $36,500 during the month of July. Calculate the following amounts.

A) $1,750 and $2,450
B) $2,000 and $2,950
C) $1,825 and $2,525
D) $2,125 and $3,075

Answer 1

To calculate Janet Roberts' commission, we need to determine the amount of her individual sales that fall into each commission bracket and then multiply those amounts by the corresponding commission rates. The correct answer is D) $2,125 and $3,075.

Step-by-step explanation:

To calculate Janet Roberts' commission, we need to determine the amount of her individual sales that fall into each commission bracket and then multiply those amounts by the corresponding commission rates.

Step 1: Calculate the commission on the first $17,500 of sales, which is 5% of $17,500:
$17,500 * 0.05 = $875

Step 2: Calculate the commission on the remaining sales, which is 9% of the sales amount above $17,500:
$36,500 - $17,500 = $19,000 (sales amount above $17,500)
$19,000 * 0.09 = $1,710

Step 3: Add the two commission amounts together:
$875 + $1,710 = $2,585

Therefore, the correct answer is D) $2,125 and $3,075.