Caleb has a guaranteed minimum salary of $1,200 per month, or 5.5% of his total monthly sales (as commission), whichever is higher.
Last month, his total sales were $45,000. What was his gross pay?
Group of answer choices
$24,750
$3,675
$2,475
$1,200
To find Caleb's gross pay, we need to calculate both his guaranteed minimum salary and his commission, then choose the higher value.
Caleb's guaranteed minimum salary is $1,200 per month.
His commission is 5.5% of his total monthly sales, which is 5.5/100 * $45,000 = $2,475.
Since $2,475 is higher than $1,200, Caleb's gross pay is $2,475.
Therefore, the answer is $2,475.
To calculate Caleb's gross pay, we need to determine if his commission or the minimum salary of $1,200 is higher. If his commission is higher, then his gross pay will be the commission amount, otherwise, it will be the minimum salary.
To calculate the commission, we multiply Caleb's total sales by the commission rate of 5.5%:
Commission = Total Sales * Commission Rate
Commission = $45,000 * 0.055
Commission = $2,475
Since the commission of $2,475 is higher than the minimum salary of $1,200, Caleb's gross pay will be $2,475.
Therefore, the correct answer is $2,475.
To calculate Caleb's gross pay, we need to determine the amount earned from his commission and compare it to his guaranteed minimum salary.
First, we need to calculate the commission earned.
Commission = Total sales * Commission rate
Commission = $45,000 * 5.5% = $2,475
Next, we need to compare the commission earned to the guaranteed minimum salary and select the higher value.
Gross pay = max(Commission, Guaranteed minimum salary)
Gross pay = max($2,475, $1,200) = $2,475
Therefore, Caleb's gross pay is $2,475.
The correct answer is $2,475.