Question

Jesse Daniels is a commission-based employee who is single with one withholding allowance. She is paid $7.00/hour and receives a 5 percent commission on net sales. She does not receive commissions until her net sales exceed $58,000 during a weekly period at Perous Pharmaceuticals. For the week ending May 5, 20XX, she worked 48 hours and sold $70,000 of medicinals but had $1,400 of returns from last week’s sales. Company policy requires that commissions on returned sales be deducted from her pay during the next pay period.

Required:
Compute her gross pay for the week. (Round your dollar and hour values to 2 decimal places.)

Company	Perous Pharmaceuticals				Period Ended:		May 5, 20XX
Name	M/S	# W/H	Hourly Rate	No. of Regular Hours	No. of Overtime Hours	Regular Earnings	Overtime Earnings	Net Commissions	Gross Earnings
Jesse Daniels

Answer 1

Compute her gross pay for the week as follows:

Working notes:

Regular earnings = Hourly rate x No. of regular hours = $7 x 40 = $280

Overtime earnings = Hourly rate x No. of overtime hours x 1.5 = $7 x 8 x 1.5 = $84

Net commissions

= Commission on this weeks sales - Commission of sales returns

= ($70,000 x 5%) - ($1,400 x 5%)

= $3,430