Question

You are offered two different sales jobs. The first company offers a straight commission of 6% of the sales. The second company offers a salary of $ 240 per week plus 4% of the sales. How much would you have to sell in a week in order for the straight commission offer to be at least as good?

Answer 1

The straight commission offer must be at least as good as the straight commission offer, which requires sales of $12,000 in a week.

What is Straight Commission?

Straight Commission: Straight commission can also be referred to as commission-only because it is the only pay an employee receives. There is no base salary or hourly wage included in this pay structure. All compensation is based on an agreed-upon percentage of sales.

Get the complete straight commission offer as the first step.

The straight total commission can be expressed as follows:

A=R x T

A = straight total commission

R=commission rate

T=total sales

In our example,

A=0.06t=0.06 t is replaced by

R=6%=6/100=0.06

T=t in equation 1.

in the 2nd step, the second offer's total value

The total sum of the second offer can be expressed as follows:

A=F+(RT)

A=the amount of income the second company offers

F=weekly fixed wage

R = commission percentage

T = total sales

F in our instance equals $240 weekly.

in the 3rd step

R=4%=4/100=0.04

T=t is replacing A=240+(0.04t)=0.04 t+240 is in equation 2

now equate equations 1 and 2

0.06 t=0.04 t+240

(0.06 t-0.04 t)=240

0.02 t=240

t=240/0.02=12,000

The straight commission offer must be at least as good as the straight commission offer, which requires sales of $12,000 in a week.

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