Question

Dimetria Farnsworth has been making $395 per week plus a 20% commission on all sales over $2,500. Dimetria received a $25 a week raise in her salary. Her commission rate and amount stayed the same. Her total sales this week were $3,800. She also had $430 in returned sales. What were Dimetria’s gross earnings for the week? 5. Gross earnings:

Answer 1

Normal earning per week = $395

Add: raise in her salary in week = $25

*Add; 20% commission = $674

Gross earnings = $395 + $25+ $674 = $1094

*As the question said , dimetria is eligible for 20% commission on All sales over $ 2500. We assume that sales return should be eliminated from sales ie (3800-430) = $3370

Since it is over $2500 we should provide 20% commision on $3370 as a whole (as question mention all sales) =$674

**otherwise if it interprete as only over and above $2500 20% commission should be given it will be like $3370-2500*.20= $174