Question

Note: In this chapter and in all succeeding work throughout the course, unless instructed otherwise, calculate hourly rates and overtime rates as follows:

1.	Carry the hourly rate and the overtime rate to 3 decimal places and then round off to 2 decimal places (round the hourly rate to 2 decimal places before multiplying by one and one-half to determine the overtime rate).
2.	If the third decimal place is 5 or more, round to the next higher cent.
3.	If the third decimal place is less than 5, simply drop the third decimal place.
	Examples:	Monthly rate $1,827 Weekly rate ($1,827 × 12)/52 = $421.615 rounded to $421.62 Hourly rate $421.62/40 = $10.540 rounded to $10.54 O.T. rate $10.54 × 1.5 = $15.81

Also, use the minimum hourly wage of $7.25 in solving these problems and all that follow.

Example 2-14

Al Carmen earns $5,200 per month and works a standard 40-hour week. During one week, Carmen earned 6 hours of overtime.

Step 1 Convert the monthly salary rate to a weekly rate by first annualizing the monthly salary. Then divide the annual salary by 52 weeks.	→	$5,200 monthly salary × 12 months = $62,400 annual salary $62,400 annual salary ÷ 52 weeks = $1,200 weekly salary
Step 2 Divide the weekly rate by the standard number of hours in the workweek.	→	$1,200 weekly salary ÷ 40 hours = $30.00 hourly rate
Step 3 Compute the overtime rate by multiplying the hourly rate by 1.5.	→	$30.00 hourly rate × 1.5 = $45.00 overtime rate
Step 4 Compute the gross pay for the week by adding the overtime earnings to the regular weekly earnings.	→	Regular weekly earnings $1,200.00 Overtime earnings (6 × $45.00) 270.00 Gross pay $1,470.00

Cal DiMangino earns $2,496 each month and works 40 hours each week. Compute the following amounts.

Round all divisions to two decimal places and use the rounded amounts in subsequent computations. Round your final answers to the nearest cent.

a. The hourly rate	$______________
b. The overtime rate at time and one-half	$______________

Answer 1