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CommissionCommission

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Commission (1/4)

A commission is paid as a percentage of an employees sales.

A retainer is a fixed payment ,to keep a salesman, irrespective of sales.

Commission may be paid on a sliding scale.

E.g. 5% of the first $10 000 and 2.5% of the balance.

or

0% of the first $10 000 and 2.5% of the balance.

End ofSlide

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Commission (2/4)

Example 1:

Sarah earns a commission of 4% on sales of $50 000.

What is her commission?

Commission = 0.04

4% as a decimal (Rate of commission)

x 50 000 Sales

= $2

000

End ofSlide

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Commission (3/4)

Example 2: John earns a commission of 5% on

sales up to $150 000 and 2.5% of the balance.

What commission on sales of $400 000?

Commission =

0.05

(Rate of commission)5% as a decimal

x 150

000

Basic Sales

+

0.025 2.5% as a decimal

x (400 000 – 150

000)

Balance over $150 000

= $13 750

End ofSlide

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Commission (4/4)

Example 3: Jane is paid a retainer of $500 and earns a

commission of 3% on sales over $3 000.

What is her commission on sales of $5 600?

Commission = 500

Retainer

+ 0.03

3% as a decimal

x (5 600 – 3

000) Balance over $3

000 = $578

End ofShow