Employee's Total Earnings Calculation on Sales

How to calculate an employee's total earnings on $81,500 in sales?

A graduated commission employee makes 3.5% interest on the first $50,000 in sales and 6.5% interest on all sales over $50,000. Which expression represents the employee’s total earnings on $81,500 in sales?

a. (0.035)(50,000) + (0.065)(31,500)
b. (0.035)(50,000) + (0.065)(31,500)
c. (0.35)(50,000) + (0.65)(31,500)
d. (3.5)(50,000) + (6.5)(31,500)

Please select the best answer from the choices provided A, B, C, D.

Answer:

The correct expression that represents the employee's total earnings on $81,500 in sales is option B, (0.035)(50,000) + (0.065)(31,500). This expression accounts for the different commission rates for the two ranges of sales.

In the given scenario, the employee earns a 3.5% commission on the first $50,000 in sales and a higher rate of 6.5% on all sales over $50,000. To calculate the total earnings, we need to consider the sales within each range separately and then sum them up.

For the first $50,000 in sales, the employee earns (0.035)(50,000), representing the 3.5% commission on that amount. For the remaining sales amount over $50,000 (which is $81,500 - $50,000 = $31,500), the employee earns (0.065)(31,500), representing the 6.5% commission on that amount.

By adding these two amounts together, we get the total earnings on $81,500 in sales, as given by option B, (0.035)(50,000) + (0.065)(31,500).