LEARNING ACTIVITY SHEET ₱5, 790,000 × 0.

02 = ₱115,800
ABM 11 Business Mathematics (Q2-WK1) Thus, she earned ₱115,800 commission.
Commission
b. Sometimes, there are items being returned by the customer. If it
Discussion
happens, the sale is not qualified for a commission. So, we compute for
the commission as follows:
Commission is the amount of money paid to employees who makes sale or
Step 1: Subtract the amount of the returned item from the net sale.
provides services. There are some instances that the process and rates of
₱5,790,000 - ₱1,200,000 = ₱4,590,000
calculation may be different from one company to another. To find the
commission, multiply the total sales and the rate. Step 2: Then compute for the commission.
₱4,590,000 × 0.02 = ₱91,800
Three Categories of Commission Thus, she earned ₱91,800 commission.

1. Straight Commission is when a salesperson is being paid only through c. In finding the net sale, divide the commission and rate.
the percentage of sales. It means no sales, no pay. They earn a Commission ₱ 120,000
Net sales = = = ₱6,000,000
commission instead of a fixed salary or hourly pay. Rate 0.02

Example 1: Ella sells cellphone cases and is paid a straight commission of
₱2.00 on each item she sells. For the month of October, she sells 790
cellphone cases. Find her commission.
Solution: 790 × ₱2.00 = ₱1,580
Example 2: Maria works in a company that sells cars. The company pays
her in a straight commission monthly with a rate of 2% of her total net
sales. She had a net sale of ₱5, 790,000 for the month of September.
a. How much commission did she earn for the month of
September?
b. What is her commission if her one customer cancelled an item
amounting to ₱1, 200,000?
c. If she has a commission of ₱120,000, how much is the net sale
of Maria for a month?
Solution:
a. Since Maria receives a commission of 2% of her total net sales,
she received:
Example 3. Gab receives a commission of ₱2,000 if he has a total sale of
₱100,000 in a month. What is the rate of commission?
Solution:
To find the rate of commission, divide the total sale to the amount
of commission.
Total s ales ₱ 100,000
Rate = = = 0.02
Amount of commission ₱ 2,000
Change to percentage = 0.02 × 100 = 2%
2. Graduated Commission is when the level of sales increases, the
commission rates also increases. This is another way that company uses
to encourage their salespersons to perform well. Graduated commissions
may also be based on the number of units sold.
Example 1: Marina receives a commission of 2% if she has total sales of
₱100,000 and another 2% on the next ₱200,000 in a month. How much
will be her total earnings if she has a total sale of ₱350,000?
Solution:
 Step 1: Marina automatically received a commission.
₱350,000 × 0.02 = ₱7,000
Step 2: To compute her commission on the next ₱200,000.
₱350,000 - ₱200,000 = ₱150,000
₱150,000 × 0.02 = ₱3,000
Step 3: Add her total commission.
₱7,000 + ₱3,000= ₱10,000
Thus, Marina will earn ₱10,000.
Example 2: Company A offers a commission of 3% on the first ₱20,000 of
sales; additional 2% on the next ₱30,000; and additional 1% on sales over
₱40,000. How much will be the total commission of Rina if her total sales
is ₱200,000 in a month?
Solution:
Step 1: She automatically earns a 3% commission on his sales.
₱200,000 × 0.03 = ₱6,000
Step 2: To compute her earnings on the next rate which is 4%:
₱200,000 - ₱30,000 = ₱170,000
₱170,000 × 0.02 = ₱3,400
Step 3: To compute her earnings on the next rate which is 5%:
₱200,000 - ₱40,000 = ₱160,000
₱160,000 × 0.01 = ₱1,600
Step 4: Add all the computed earnings.
₱6,000 + ₱3,400 + ₱1,600 = ₱11,000
Thus, Rina has a total commission of ₱11,000 in a month.
3. Salary Plus Commission is when a salesperson is being paid by his or
her monthly salary and a percentage of his or her sales.
Example 1: Carlo receives a monthly salary of ₱18,600 in a month and he
is being paid by 7% of any sales above ₱30,000. How much will be his
total earnings if he reaches a total sale of ₱50,000?
Step 1: Solve for the commission.
₱50,000-₱30,000 = ₱20,000
His commission is ₱20,000 × 0.07 = ₱1,400
Step 2: Add his salary and his commission
₱18,600 + ₱1,400 = ₱20,000
Example 2: Angelo is working in appliance store. His basic salary is
₱15,000 monthly. He has to sell different appliances worth ₱20,000 above
to get 3% commission on a weekly total sale. The following table shows her
sales output for a month.
Week Sales
1 ₱23,600
2 ₱17,200
3 ₱31,560
4 ₱27,350
a. How much will be the total commission of Angelo?
b. How much will be his total earnings in a month?
Solution:
a. Compute for his week 1 commission = ₱23,600×0.03 = ₱700
For week 2, he did not hit the target quota, so he has no commission.
For week 3 commission = ₱31,560×0.03 = ₱946.80
For week 4 commission = ₱27,350×0.03 = ₱820.50
Add all the commissions = ₱700+₱946.80+₱820.50=₱2,467.30
b. To find his total earnings, add the commission and salary.
₱15,000 + =₱2,467.30 = ₱17,467.30
V. Activities
Now that you are already familiar with the concepts of commission and its’
three categories, you are ready to take on these different activities.
A. Complete the table below.

Solution:
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 Total Sales Rate Commission A. ₱120,000 B. ₱12,000 C. ₱140,000 D. ₱144,000
1. ₱230,000 3% 2. A saleslady received ₱1,200 as her commission. Her rate of commission
2. ₱160,000 ₱3,200 was 5%. What was the selling price?
A. ₱23,000 B. ₱24,000 C. ₱27,000
3. 1.5% ₱48,000
D. ₱19,000
4. ₱3,000,000 ₱30,000
5. ₱150,000 ₱4,500 For items 3-7, below shows the sales record of Karla in the first quarter of
the year. She is paid a monthly salary of ₱12,000.
B. Below shows the sales of 5 employees who are working at the appliance
store. They are paid 1.5% commission on sales up to ₱40,000, 2% Month Sales
commission on sales from ₱40,000 to ₱60,000, and 3% on sales above
January ₱23,000
₱60,000. Some employees are paid in monthly salaries in addition to
commission. Complete the table below and answer the questions that February ₱19,800
follow: March ₱15,900

Salesperson Sales Salary Gross Pay 3. What is her gross pay for the month of January if she has a commission
of 2% in her net sales of ₱20,000?
Jamie ₱30,500 ₱8,000
A. ₱12,460 B. ₱21,640 C. ₱23,460
Ariel ₱76,000 0 D. ₱11,230
Mark ₱57,000 ₱11,300 4. If she received a commission of ₱990 for the month of February, what is
the rate of commission?
Anne ₱40,000 ₱16,000
A. 2% B. 3% C. 4%
Emie ₱63,000 0 D. 5%
5. Karla was paid ₱12,636 for the month of February. How much is the
commission she received?
1. How much is the total sales and gross pay of the 5 employees?
A. ₱540 B. ₱636 C. ₱763
2. Who has the highest gross pay? D. ₱840
3. Who has the lowest gross pay? 6. What is the total commission of Karla for the first quarter if she is being
paid for 3% commission for net sales of ₱10,000?
VI. Assessment A. ₱1,071 B. ₱1,167 C. ₱1,284
D. ₱1,761
A. Multiple Choice. Read each question carefully then write the letter of 7. How much is the gross pay of Karla for the first quarter if she has a 2%
commission for net sale of ₱16,000, 3% commission for ₱16,000 to
the best answer from the given choices. Use separate sheet of paper for
₱20,000 and another 4% commission if she has net sales above ₱20,000?
your answer and solution.
A. ₱24,800 B. ₱21,614 C. ₱25,110
D. ₱25,640
1. An agent sold a property worth ₱1,200,000. He has a commission of
12%. How much does he receive?
3
8. Jane is working in a real state and paid a salary of ₱27,000 monthly
plus 5% commission on her monthly net sales. She received a total of
₱58,500 earnings for this month. How much was her monthly sales?
A. ₱230,000 B. ₱630,000 C. ₱450,000 D. ₱712,000
For items 9-10. Jiren receives a straight commission of 5% of his net sales
of ₱350,000 in a month. He has net sales of ₱560,000 in a month.
9. How much will she earn in a month?
A. ₱33,600 B. ₱47,800 C. ₱52,300
D. ₱61,900
10. If an item was returned amounting to ₱45,690, how much earnings
will he receive in a month?
A. ₱13,460 B. ₱14,990 C. ₱15,790
D. ₱25,720
VII. Reflection
Now that you know understand the concepts of commission, answer the
following questions.
1. What did I learn?
2. How can I apply this in a situation?
3. What are the risks involved in working on commission?