Question

Terry McNutt, a single employee with two withholding allowances, is paid $9.50 per hour and receives commission on net sales. He does not receive a commission until his net sales exceed $150,000. Once the minimum net sales is reached, he receives 5 percent commission on all of his sales at Skidoo Sports. During the week of January 23, he sold $87,000 of ski equipment; however, he had $1,900 of returns from the prior week's sales. Company policy requires that commissions on sales returns are deducted from the employee's pay, regardless of current commission earnings. Required: Compute Terry's gross pay for the 40 hour weekly pay period. (Negative amount(s) should be indicated by a minus sign.) Company Skidoo Sports Period Ended: 1/23/20XX Name M/S # of W/H Hourly Rate No. of Regular Hours Regular Earnings Commissions Gross Earnings Terry McNutt

Answer 1

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A B C D E F G H 1 2 3 4 Name M/S #of W/4 Hourly Rate No. of Regular Hours Regular Earnings Commissions Gross Earnings Terry McNutts 21 9.5 380 -95 285 4 40 5 6 Terry MCNutt sold only $87,000 but threshold limit is $150,000. So, there is no commission for the week and moreover $1,900 sales returns commission paid earlier should reverse back. i.e., $1,900*5%=$95 7 8

For calculation ref:

A B с D E F H 1 Nm Name MS #of W/4 Hourly Rate No. of Regular Hours Regular Earnings Commissions Gross Earnings Terry McNutts 2 9.5 40 =F4*E4 |--1900*5% =G4+H4 4 5 6 Terry MCNutt sold only $87,000 but threshold limit is $150,000. So, there is no commission for the week and moreover $1,900 sales returns commission paid earlier should reverse back. i.e., $1,900*5%=$95 7 8