Lisa has a guaranteed minimum salary of $1600 per month, or 6.5% of her total monthly sales (as commission), whichever is higher.
Last month, her total sales were $23,000. What was her gross pay?
Group of answer choices
$1,600
$14,950
First, we need to calculate 6.5% of her total monthly sales:
0.065 * $23,000 = $1,495
Next, we compare this with her guaranteed minimum salary. Since $1,495 is higher than $1,600, her commission is $1,495.
Therefore, her gross pay is $1,495.
To calculate Lisa's gross pay, we need to determine whether her commission or the guaranteed minimum salary is higher.
First, let's calculate the commission based on her total monthly sales of $23,000. The commission is calculated as 6.5% of the total sales:
Commission = (Total sales) * (Commission rate)
Commission = $23,000 * 0.065
Commission = $1,495
Next, we compare the commission to the guaranteed minimum salary of $1,600. Since the commission is lower than the guaranteed minimum salary, Lisa's gross pay will be $1,600.
Therefore, the correct answer is:
$1,600
To calculate Lisa's gross pay, we need to determine the higher amount between her guaranteed minimum salary and her commission based on her total monthly sales.
First, let's calculate her commission:
Commission = Total Monthly Sales x Commission Rate
Commission = $23,000 x 0.065
Commission = $1,495
Next, we compare the commission amount with her guaranteed minimum salary:
Gross Pay = Max(Commission, Guaranteed Minimum Salary)
Gross Pay = Max($1,495, $1,600)
Gross Pay = $1,600
Therefore, Lisa's gross pay is $1,600.