Example 2-25Kate Kline receives an annual $35,000 base salary for working a certain territory. A sales quota of $800,000 has been set for that territory for thecurrent year. Kline will receive a 6 percent commission on all sales in excess of $800,000. For the current year, the sales in the territory are$1,030,000. The bonus paid Kline would be:Kline's total earnings for the year would be:$13,800 (6% of $230,000)a. The regular annual salaryb. The commissionc. The total annual earnings$48,800 ($35,000+ $13,800)Wendy Epstein, a sales representative, earns an annual salary of $29,500 and receives a commission on that portion of her annual sales that exceeds $150,000. Thecommission is 8.5% on all sales up to $50,000 above the quota. Beyond that amount, she receives a commission of 10%. Her total sales for the past year were $295,000.Compute the following amounts:

Given in the question: The annual base salary is $29,500 to the Wendy Epstein who is a sales…

Answered: a. The regular annual salary b. The…

Business

Accounting

a. The regular annual salary b. The commission c. The total annual earnings SA 000 S SA

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Payroll Entries

Payroll is a comprehensive record of employees that are paid by the company. Payroll classifies employees into various categories according to their function and pays scale (basic wage, allowance, income tax, other taxes, employee loans, etc.). Payroll processes form the bedrock of every organization as it contains sensitive information on the ‘wage and paycheck’ portion of the company’s strength—its employees. The organization needs to keep a track of the employees currently on the payroll, the net payout for the company, the record of transactions related to the employees including deductions and payroll taxes to identify the liability and its effect on the balance sheet (and other financial statements). Payroll records also include qualitative factors such as the conduct of the employee.

Question

Example 2-25
Kate Kline receives an annual $35,000 base salary for working a certain territory. A sales quota of $800,000 has been set for that territory for the
current year. Kline will receive a 6 percent commission on all sales in excess of $800,000. For the current year, the sales in the territory are
$1,030,000. The bonus paid Kline would be:
Kline's total earnings for the year would be:
$13,800 (6% of $230,000)
a. The regular annual salary
b. The commission
c. The total annual earnings
$48,800 ($35,000+ $13,800)
Wendy Epstein, a sales representative, earns an annual salary of $29,500 and receives a commission on that portion of her annual sales that exceeds $150,000. The
commission is 8.5% on all sales up to $50,000 above the quota. Beyond that amount, she receives a commission of 10%. Her total sales for the past year were $295,000.
Compute the following amounts:

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