Question

PSa 2-10 Calculate Gross Pay for a Tipped Employee

Calculate gross pay for each of the following employees. All are paid an overtime wage rate that is 1.5 times their respective regular wage rates.

NOTE: For simplicity, all calculations throughout this exercise, both intermediate and final, should be rounded to two decimal places at each calculation.

1: Anita Workman receives tips from customers as a standard component of her weekly pay. She is paid $2.50/hour by her employer and receives $284 in tips during the most recent 46-hour workweek.

Gross Pay = $

2: Cole Earnhardt receives tips from customers as a standard component of his weekly pay. He is paid 2.13/hour by his employer and receives $442 in tips during the most recent 42-hour workweek.

Gross Pay = $

3: Calista Flood receives tips from customers as a standard component of her weekly pay. She is paid $4.10/hour by her employer and receives $350 in tips during the most recent 38-hour workweek.

Gross Pay = $

4: Bethany Pugh receives tips from customers as a standard component of her weekly pay. She is paid $3.60/hour by her employer and receives $162 in tips during the most recent 51-hour workweek.

Gross Pay = $

Answer 1

Sr. No. .	Name of Employee	Particulars	Minimum Pay (No. of hrs. X rate/hr)	Overtime Pay (no. of OT hrs X rate /hr)	Gross Pay (Minimum Pay + OT Pay	Tipped Wages No. of tips X rate
1	Anita	OT pay=2.5 X 1.5=3.75	40 hrs X $.2.50/hr = $.100	6 hrs. X $ 3.75/hr = $. 22.5	$ 122.5	284 X (5.12-2.50) $.2.62 = $. 744.08
2.	Cole Earnhardt	OT pay=2.13 X 1.5=3.20	40 hrs X $.2.13/hr = $.85.2	2 hrs. X $ 3.20/hr = $. 6.40	$ 91.6	442 X (5.12-2.99) $.2.99 = $. 1321.58
3	Calista Flood		38 hrs X $.4.10/hr = $.155.8	--------	$ 155.8	350 X (5.12-4.10) $.1.02 = $. 357
4	Bethany Pugh	OT pay=3.6 X 1.5=5.4	40 hrs X $.3.6/hr = $.144	11 hrs. X $ 5.4/hr = $. 59.40	$ 203.4	162 X (5.12-3.6) $.1.52 = $. 246.24

Answer 2

Anita Workman receives tips from customers as a standard component of her weekly pay. She is paid $2.50/hour by her employer and receives $284 in tips during the most recent 46-hour workweek

Step A: 2.50^{(Below minimum wage)} x 40 = 100^{(pay at regular rate)}

Step B: 7.25^{(actual min. wage)} - 2.50= 4.75 ^{Tip Credit}

Step C: 7.25 x 1.5= 10.88

Step D: 10.88 - 4.75 = 6.13

Step E:  6.13 x 6 = 36.78 ^{overtime pay} 

Step F: 100^{regular pay} + 36.78^{overtime pay}+ 284^Tips=420.78 ^{gross pay}