Transcript Commissions, Royalties, & Piecework Pay

Commissions, Royalties, & Piecework
Pay
Section 6-3
Pay Plans
 Last week, we covered:
 Annual Salary – paid by the year
 Hourly Pay – paid by the hour
 What other types of pay plans are there?
 Commission
Paid according to money from sales
 Royalty
 Paid according to money from sales (you are not seller)
 Piecework Pay
 Paid according to units produced

Commission
 Some jobs that get paid commission:
a)
Real Estate Agent
b)
Salesmen for department stores
c)
TV – Sales
d)
Any type of sales job
Royalties
 Some jobs that pay royalties
a)
Author
b)
Movie Director
c)
Actor/Actress
d)
Musician
Piecework Pay
 Jobs that have piecework pay plans:
a)
Newspaper delivery
b)
Field workers (pick corn, strawberries, etc)
c)
Factory workers
Advantages vs. Disadvantages
 As an employee, what are the advantages of being paid
commission or piecework?
 What are the disadvantages?
 As an employer, what are the advantages of being paid
commission or piecework?
 What are the disadvantages?
Calculating Commission
 Huey Gaines is paid a straight commission of 6% on his
sales. During February, his sales were $38,000. What was
his commission?
Find his commission rate:
6%
Convert the percent to a decimal:
0.06
Multiply the decimal by the amount of sales:
0.06 x 38,000 = $2,280
Calculating Commission
 Melvin’s sales last month of a new tile cleaner were
$9,500. If he receives a commission rate of 15% of all
sales, what commission did he earn?
Find his commission rate:
15%
Convert the percent to a decimal:
0.15
Multiply the decimal by the amount of sales:
0.15 x 9,500
= $1,425
Calculating Commission
 Jacqueline earned 15% commission on her monthly sales
of $2,870, $3,150, and $3,940. What was her total
commission for all three months.
First Month:
0.15 x 2,870 = $430.50
Second Month: 0.15 x 3,150 = $472.50
Third Month: 0.15 x 3,940 = $591
Total Commission: = $1,494
Calculating Commission
 Liz receives a weekly salary of $200, plus 3% commission on
her sales. Last week, she sold $29,700 of computer
equipment. How much did she earn?
Earnings = Commission + weekly Salary
Commission = 0.03 x 29,700 = $891
Weekly Salary = = $200
Earnings = = $891 + $200 = $1,091.00