Question

Henry earns a base salary plus commission. At the end of March he was paid \$2,427 based on his monthly sales of \$15,800. At the end of April he earned \$2,771.50 based on \$21,100 in sales. What was his base salary?

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Answer 1

The base salary is $1,400

Explanation:

Here, we are interested in calculating the base salary.

Now let’s picture his earnings as this, a base salary of let’s say $x and a percentage of y% of total sales as commission.

So let’s move!

For the month of march, his earnings is calculated as follows;

x + (y/100 * 15,800) = 2427

so we have;

x + 158y = 2427 •••••••(i)

For the month of April, we have

x + (y/100 * 21,100) = 2771.5

x + 211y = 2771.5 ••••••(ii)

So we have two equations to solve simultaneously.

We can easily get y by subtracting equation i from ii

That would be ;

(211y-158y) = 2771.5-2427

53y = 344.5

y = 344.5/53

y = 6.5%

So we can now get the base salary by substituting the value of y in any of the equations. Let’s use the first

x + 158(6.5) = 2427

x + 1027 = 2427

x = 2427-1027

x = $1,400