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Mary Jo Prenaris is an office manager with gross earnings of $1,600 semimonthly. If her company switches pay schedules from semimonthly to biweekly, what are Mary Jo's new gross earnings?
$ biweekly salary
She got 24 pay checks a year under the old plan.
She'll get 26 a year under the new plan.
1600 * 24 = 38,400 a year
38,400 / 26 = ?
1476.92
To determine Mary Jo's new gross earnings after the switch from a semimonthly pay schedule to a biweekly pay schedule, we need to understand the difference between these two schedules.
Semimonthly pay schedule: Mary Jo currently receives her salary twice per month, which amounts to 24 paychecks in a year (12 months * 2 paychecks).
Biweekly pay schedule: Under a biweekly pay schedule, Mary Jo would receive her salary once every two weeks, resulting in 26 paychecks in a year (52 weeks divided by 2 weeks per paycheck).
To calculate Mary Jo's new gross earnings:
1. Calculate her gross earnings per pay period:
Semimonthly gross earnings = $1,600
2. Determine the conversion factor:
Conversion factor = Number of semimonthly pay periods / Number of biweekly pay periods
Number of semimonthly pay periods = 24
Number of biweekly pay periods = 26
Conversion factor = 24 / 26 = 0.9231 (rounded to four decimal places)
3. Calculate her new gross earnings:
New biweekly gross earnings = Semimonthly gross earnings * Conversion factor
New biweekly gross earnings = $1,600 * 0.9231 = $1,477.85 (rounded to two decimal places)
Therefore, Mary Jo's new gross earnings under the biweekly pay schedule would be $1,477.85.