Question

Wendy Epstein, a sales representative, earns an annual salary of $29,500 and receives a commission on that portion of her annual sales that exceeds $150,000. The commission is 8.5% on all sales up to $50,000 above the quota. Beyond that amount, she receives a commission of 10%. Her total sales for the past year were $295,000. Compute the following amounts:a. The regular annual salary $b. The commission $c. The total annual earnings $b. Calculate commission amounts on sales multiplied by commission percentages.c. Regular annual salary + commission = Total Annual earnings.

Answer 1

Answer:

a. Regular annual salary = $29,500

b. Sales commission = $13,750

c. Total annual earnings = $43,250

Explanation:

a. Regular annual salary is constant and fixed = $29,500

b. Sales commission for sales above $150,000 to $200,000 = 8.5%

On sales above $200,000 Sales commission = 10%

Actual Sales for the year = $295,000

Sales Commission

= $200,000 - $150,000 = $50,000 $\times$ 8.5% = $4,250

+ $295,000 - $200,000 = $95,000 $\times$ 10% = $9,500

Total commission = $4,250 + $9,500 = $13,750

c. Total annual earnings =  Annual salary + Total commission

= $29,500 + $13,750 = $43,250

Final Answer

a. Regular annual salary = $29,500

b. Sales commission = $13,750

c. Total annual earnings = $43,250