Business Math

Quarter 2 – Module 1:
Types of Commissions and
Computing Commissions on Cash
and Installment Basis
Business Math – Grade 11
Alternative Delivery Mode
Quarter 2 – Module 1: Types of Commissions and Computing Commissions on Cash
and Installment Basis
First Edition, 2020

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 Business Math
Quarter 2 – Module 1:
Types of Commissions and
Computing Commissions on Cash
and Installment Basis
Introductory Message

For the facilitator:

Welcome to the Business Math – Grade 11 Alternative Delivery Mode (ADM)

Module on Types of Commissions and Computing Commissions on Cash and
Installment Basis!

This module was collaboratively designed, developed and reviewed by

educators both from public and private institutions to assist you, the teacher or
facilitator in helping the learners meet the standards set by the K to 12 Curriculum
while overcoming their personal, social, and economic constraints in schooling.

This learning resource hopes to engage the learners into guided and
independent learning activities at their own pace and time. Furthermore, this also
aims to help learners acquire the needed 21st century skills while taking into
consideration their needs and circumstances.

In addition to the material in the main text, you will also see this box in the
body of the module:

Notes to the Teacher

This contains helpful tips or strategies that
will help you in guiding the learners.

As a facilitator you are expected to orient the learners on how to use this
module. You also need to keep track of the learners' progress while allowing them to
manage their own learning. Furthermore, you are expected to encourage and assist
the learners as they do the tasks included in the module.

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For the learner:

Welcome to the Business Math – Grade 11 Alternative Delivery Mode (ADM)

Module on Types of Commissions and Computing Commissions on Cash and
Installment Basis!

Business Math is a mathematical tool intended to deliver an utmost

understanding about money and information needed to make good financial
decisions. It does not only concentrate on the essentials of business finances, such
as owning or operating a business, but it also provides an avenue where people in
every walk of life learn the significance of managing their personal finances. Getting
familiar with the concepts of Business Math leads to making a better decision with
your money!

This module was designed to provide you with fun and

meaningful opportunities for guided and independent learning at your own pace and
time. You will be enabled to process the contents of the learning resource while
being an active learner.

This module has the following parts and corresponding icons:

What I Need to Know This will give you an idea of the skills or
competencies you are expected to learn in the
module.
What I Know This part includes an activity that aims to
check what you already know about the
lesson to take. If you get all the answers
correct (100%), you may decide to skip this
module.
What’s In This is a brief drill or review to help you link
the current lesson with the previous one.
What’s New In this portion, the new lesson will be
introduced to you in various ways such as a
story, a song, a poem, a problem opener, an
activity or a situation.

What is It This section provides a brief discussion of the

lesson. This aims to help you discover and
understand new concepts and skills.

What’s More This comprises activities for independent

practice to solidify your understanding and
skills of the topic. You may check the
answers to the exercises using the Answer
Key at the end of the module.

What I Have Learned This includes questions or

blank sentence/paragraph to be filled into process
what you learned from the lesson.

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 What I Can Do This section provides an activity which will
help you transfer your new knowledge or skill
into real life situations or concerns.
Assessment This is a task which aims to evaluate your
level of mastery in achieving the learning
competency.
Additional Activities In this portion, another activity will be given
to you to enrich your knowledge or skill of the
lesson learned. This also tends retention of
learned concepts.
Answer Key This contains answers to all activities in the
module.

At the end of this module you will also find:

References This is a list of all sources used in developing

this module.

The following are some reminders in using this module:

1. Use the module with care. Do not put unnecessary mark/s on any part of the
module. Use a separate sheet of paper in answering the exercises.
2. Don’t forget to answer What I Know before moving on to the other activities
included in the module.
3. Read the instruction carefully before doing each task.
4. Observe honesty and integrity in doing the tasks and checking your answers.
5. Finish the task at hand before proceeding to the next.
6. Return this module to your teacher/facilitator once you are through with it.
If you encounter any difficulty in answering the tasks in this module, do not
hesitate to consult your teacher or facilitator. Always bear in mind that you are
not alone.

We hope that through this material, you will experience meaningful learning and
gain deep understanding of the relevant competencies. You can do it!

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 What I Need to Know

This module is made to help you know the different types of commissions and
how you are going to compute for those commissions in a cash and installment basis.

Our goal in this module is to assist you so that you can analyze word
problems, compute problems involving commissions and apply it in a real-life
scenario. Together, we will make a detailed study and practice lots of activities.

At the end of this module, you are expected to:

1. Illustrate different types of commissions. (ABM_BM11BS-IIa-11)

2. Compute commissions on cash and installment basis. (ABM_BM11BS-IIa-
12)

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 What I Know

DIRECTIONS: On a separate sheet of paper, write only the letter corresponding to

your final answer. Please do not write anything on the module.

1. Richard is paid a monthly salary of Php12,000 and earns a commission of 3% in

sales. If he sold a total amount of Php80,000 this month, how much is his gross
pay?
a. Php14,000
b. Php14,400
c. P h p 1 5 , 0 0 0
d. Php15,400

2. Ruby is paid with a 4% commission and she was able to sell a total amount of
Php180,000. How much is her commission for this?
a. Php5,200
b. Php6,200
c. Php7,200
d. Php8,200

3. John makes money by commission rates. He gets 13% of everything he sells. If

John sold Php23,000 for this month, how much is his salary?
a. Php2,990
b. Php3,440
c. PHp3,990
d. PHp4,440

4. Anna makes Php7,000 a month plus money she gets from commission for
everything that she sells. If Anna sold Php55,000 worth of items and got a salary
of Php 10,300, how many percent is the commission rate?
a. 3%
b. 4%
c. 5%
d. 6%

5. ABC Company pays all their salespeople 3% on sales up to Php50,000 and 5.5%
commission on sales more than Php50,000. If Nathan sold an amount of
Php75,000 in August, what is his gross commission for that month?
a. Php875
b. Php1,875
c. Php2,875
d. Php3,875

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6. Nathalie sells phone cases at Cellzone computer retail store. She receives a 2%
commission for every Php10,000 sale she will make, and additional 3% if she
surpassed the Php10,000 mark. She has a total sale of Php19,800. How much
will be her total commission?
a. Php494
b. Php594
c. Php694
d. Php794

7. Charlie receives a 5% commission on all his sales up to Php12,000. If he is given

7% for all sales in excess of Php12,000, how much is his gross pay if he targets a
Php45,000 sales?
a. Php1,910
b. Php2,190
c. Php3,190
d. Php4,190

8. Allaine receives a monthly salary of Php10,000. On top of that, she will get a
commission of 5% for the sales that she can make. This July, she sold Php35,000
worth of goods. How much will be her total earnings?
a. Php8,750
b. Php9,750
c. P h p 1 0 , 7 5 0
d. Php11,750

9. Bryan receives a monthly salary of Php6,700 and some additional money from a
5% commission rate whenever he sells an item. If he sold Php15,000 worth of
items this month, how much will be his additional money?
a. Php6,450
b. Php7,450
c. Php8,450
d. Php9,450

10. Marianne sold a house and lot that costs Php3,200,000. The owner promised to
give her a 5% commission rate for this. How much will Marianne get?
a. Php130,000
b. Php140,000
c. Php150,000
d. Php160,000

11. You have a minimum salary of Php30,000 a month and a commission of 3%.
How much will you get if you sell items worth Php110,000?
a. Php33,300
b. Php33,400
c. P h p 3 3 , 5 0 0
d. Php33,600

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12. Rosie has a commission of 10% for every cellphone she can sell. She sold a
Php76,000 worth of phone. How much is her salary?
a. Php7,600
b. Php7,800
c. Php7,900
d. Php8,000

13. Rufo is a sales agent in a company that offers 5% commission with a basic salary
of Php15,000. He sold items worth Php24,000. How much will he get?
a. Php1,200
b. Php11,200
c. P h p 1 5 , 0 0 0
d. Php16,200

14. It is the type of commission that has a basic salary.

a. Straight
b. Graduated
c. Salary Plus
d. None of the Above

15. What is the formula for commission?

a. Commission Rate + Total Amount Sale of the Month
b. Commission Rate - Total Amount Sale of the Month
c. Commission Rate / Total Amount Sale of the Month
d. Commission Rate x Total Amount Sale of the Month

Good job!

You did well on our pre-assessment! We will be learning

more on this module.

Are you ready?

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 Lesson Types of Commissions and
1 Computing Commissions on
Cash and Installment Basis
Since the subject you are taking is Business Mathematics, you will often
encounter the percentage relationship in most of our topics, just like today.

Knowing percentage relationship will help you better understand the topic for
this week. You need to have a full knowledge about it for you not to have a hard time
understanding the next topic we will be studying.

Here are some questions regarding percentage relationship to have a

refreshment. Enjoy and stick with it till the end!

What’s In

DIRECTIONS: Solve the following. Write your answers to the questions below on a
separate sheet of paper. Please do not write anything on the module.

1. What percent of 90 is 45?

2. What is 32% of 690?

3. Two hundred thirty-two is 10% of what number?

4. What percent of 28 is 22?

5. Forty-eight is 60% of what number?

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 What’s New

Ms. Katrina Perez is a sales agent at Toyota Bataan Branch. The company
offers her a commission of 3.5% in every car that she will sell. Last June, the Bataan
Branch celebrated their 5th year and added 2% commission on all its employees
including Ms. Perez. Luckily, she sold an Innova car that costs Php1,538,000 on that
month. The company also ensures that the employees have their monthly salary of
Php12,000 with or without a sale.

a. How much will be the commission if it is not their branch’s anniversary?

b. How much is the total commission that Ms. Perez will get?
c. How much is her total income on that month?
d. How much will be the remaining sales that the company will get?

Excellent!

On the next pages, read and study carefully the different

types of commissions and how you are going to solve problems
involving commissions on a cash and installment basis.

Let’s start!

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 What is It

Now, we will be discussing different types of commissions and how to

compute commissions on a cash and installment basis.

First things first, you need to understand the words that you will often
encounter in this module. Understanding these words will help you have a full
insight what the topic is all about. This will make you better understand
questions and problems in this module. You need to focus! You can do it!

ILLUSTRATE TYPES OF COMMISSIONS AND

COMPUTE COMMISSIONS ON CASH AND
INSTALLMENT BASIS

Commission is a payment based on the percentage of sales of an agent.

Commission will help the employer and employees to have a harmonious
relationship within the company. This will serve as a reward for the employees who
will make a sale. It can also be a driving force for the employees to do their job
efficiently and effectively.

Formula for the Commission

Commission Rate x Total Amount Sale of the Month

Formula for the Gross Pay for the Month

Commission + Basic Salary

Steps in Computing for the Commission

1. Analyze the problem carefully.
2. Jot down all the given.
3. Write the indicated formula.
4. Substitute the given to the formula.
5. Perform the operations needed.

Different Types of Commissions

1. Straight Commission
2. Graduated Commission
3. Salary Plus Commission

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 A Straight Commission is a form of compensation but with no fixed salary of
the agent. It means that it is only the commission of sales that the agent will get from
the company.

EXAMPLE 1 (Straight Commission): Nathaniel works in a company with a

commission only basis. His boss gave him a 3.2% commission on his total monthly
sales without a base salary. Fortunately, Nathaniel made a sale of Php180,000 for
the month of July. How much will be his commission?

Solution: Commission Rate = 3.2% → 0.032 (always make this a decimal point)
Total Sale = Php180,000

Formula: Commission Rate x Total Amount Sale of the Month

= 0.032 x 180,000
= Php5,760 (the commission that Nathaniel will get for J uly)

EXAMPLE 2 (Straight Commission): Salve started a company with a

commission only basis of 2.8%. One of her employees made a sale of Php132,000
worth of furniture last March. Unfortunately, the costumer who bought a dining table
set worth Php28,300 returned it because of some defects. How much commission
will Salve give to her employee who made that sale?

Note: Returned items must be deducted to the total amount of sale before
computing for the commission.

Solution: Commission Rate = 2.8% → 0.028 (always make this a decimal point)
Total Sales = Php132,000 – Php28,300 (returned item) = Php103,700

Formula: Commission Rate x Total Amount Sale of the Month

= 0.028 x 103,700
= Php2,903.60 (the commission that Salve will give to her employee)

A Graduated Commission is a type of commission that the company gives to

their sales agent not in once but in gradual. The commission will increase if the sale
of an agent also increases. This will encourage the agent to sell more so that they
can earn a big commission.

EXAMPLE 3 (Graduated Commission): Rolando is an agent with a

commission of 3% on his first Php150,000 of sales during the month and 2.5%
commission on sales above Php150,000. He happened to have a sale of Php187,000.
How much will he earn?

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Solution: 1st Commission Rate = 3% → 0.03 (always make this a decimal point)
1st Sale = Php150,000

2nd Commission Rate =2.5% → 0.025 (always make this a decimal point)
2nd Sale = Php187,000 – Php150,000 = Php37,000

Formula: Commission Rate x Sale of the Month

We first need to compute for the first commission that he can get from
Php150,000.

= 0.03 x 150,000
= Php 4,500 (Rolando’s first commission)

Then compute for the commission of the remaining sale.

= 0.025 x 37,000
= Php 925 (Rolando’s commission from the remaining sale)

Add the 1st and 2nd commission to get the final commission for month.

= Php 4,500 + Php 925

= Php 5,425 (Rolando’s total commission)

EXAMPLE 4 (Graduated Commission): Loretta has a monthly commission of

2.6% on all her total sales. The company gives her 1% commission bonus if she
reached a minimum of Php35,000, another 1% if she also exceeds the minimum of
Php75,000. How much will be her total earnings if she happened to reach sales of
Php98,000?

Solution: She automatically has 2.6% from all her sales so,
Php98,000 x 0.026 = Php2,548

Then, compute for her first bonus

Php98,000 – Php35,000 = Php63,000 x 0.01 = Php630

Then another 1% commission for her last bonus which is,

Php98,000 – Php75,000 = Php23,000 x 0.01 = Php230

To compute for total earnings, just add all the commission she will get
Php2,548 + Php630 + Php230 =Php3,408

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 A Salary Plus C ommission is when an agent gets a salary on top of the
commission he/she will get for every sale that he/she can make.

EXAMPLE 5 (Salary Plus Commission): Mr. Chan is working in a company

with a minimum salary wage of Php12,000 monthly. On top of his salary, he is
expected to sell appliances worth Php6,000. He can get an additional 3% commission
when he exceeds his expected sales. He fortunately made a sale worth Php13,700.
How much will be his gross pay?

Solution: To computer for his commission,

Php13,700 – Php6,000 = Php7,700 x 0.03 = Php231

Then compute now the gross pay, Commission + Monthly Salary

Php231 + Php12,000 = Php12,231

A C ommission on Installment Basis is a commission not based on sales, but

it is a commission based on the collection or what we call payments by buyers.
Installment means that the buyers didn’t pay all at once.

EXAMPLE 6 (Commission on Installment Basis): Mr. Watson works in a

cellphone shop that offers him 3% commission on every sale he can make. He made
a sale worth Php80,000 that can be paid in an installment of Php10,000 per month
for 8 months. How much will be his monthly commission? How much is the total
commission he can get?

Solution: Commission Rate = 3% → 0.03 (always make this a decimal point)

Monthly Payment = Php 10,000

Formula: Commission Rate x Payment

= 0.03 x Php10,000
= Php300 is his monthly commission.

= Php300 x 8 months
= Php2,100 is his total commission

Very Good! We are done discussing the different types

of commissions and how to compute them.

On the next pages, there are different activities that you

need to do and answer. Are you ready?

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 What’s More

DIRECTIONS: On a separate sheet of paper, solve the following problems involving

commissions and computing for commissions. This will help you practice more.
Enjoy!

1. Meredith Grey works in a company that sells furniture. She has been promised
of 3.5% commission on every furniture that she can sell. For this month, she
sold a cabinet worth Php15,500. How much is her commission for this?

2. Mark Sloan’s monthly salary is Php18,000. On top of this, whenever he sells an

appliance, he can get an additional 2.8%. Fortunately, he sold a smart TV that
costs Php43,899. How much will be the total gross pay of Mark Sloan?

What I Have Learned

Based on the given examples and practices that we

discussed, I know that you already have a full understanding about
commissions and computing for commissions.

Now, it’s time to check if you can recall information about

the topic.

DIRECTIONS: On a separate sheet of paper, please answer the following questions.

This will help you retain all the knowledge that we discussed.

1. What are the different types of commissions?

2. Differentiate the three types of commissions.
3. Enumerate the steps in computing for the commission.

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 What I Can Do

DIRECTIONS: Use sheets of paper to answer the following items.

A. Complete the table below.

Number 1 is done for you!

1. Commission = Total Sales x Commission Rate

= 1,000 x 0.028
= Php28

TOTAL SALES COMMISSION RATE COMMISSION

Php1,000 2.8% (1) Php28

Php400 3% (2)

Php1,900 (3) Php38

Php13,000 2% (4)

(5) 3% Php300

B. Analyze carefully and answer the question.

1. Joyce is a sales agent for kitchen appliances. She has a basic salary of
Php8,000 per month and an additional commission of 2.3% for every
appliance that she can sell. Fortunately, she sold an oven worth Php33,000.
How much will be her total earnings for this month?

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 Assessment

DIRECTIONS: On a separate sheet of paper, answer the following questions. Please

do not write anything on the module.

1. What type of commission is when a sales agent is paid a percentage of sales only?
A. Straight Commission
B. Graduated Commission
C. Salary Plus Commission
D. None of the Above

2. It is a payment based on the percentage of sales of an agent.

A. Interest
B. Gross Pay
C. Rate
D. Commission

3. All the following are the types of commission, EXCEPT?

A. Interest
B. Graduated
C. Straight
D. Salary Plus

4. This type of commission will encourage the agents to sell more goods.
A. Interest
B. Graduated
C. Straight
D. Salary Plus

5. What type of commission has a basic salary pay for all its agents?
A. Interest
B. Graduated
C. Straight
D. Salary Plus

6. Lady Anne works in a commission only company. She sold items worth
Php13,000 and she will get a 6% commission rate. How much did she earn?
A. Php580
B. Php680
C. Php780
D. Php880

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7. Manny has a basic salary of Php23,000 in a company he works, then he can get
an additional 4.5% on all the sales he can make. Last June, he sold a car worth
Php889,000. How much is his commission?
A. Php39,500
B. Php40,000
C. Php39,900
D. Php40,005

8. Based on the given above, how much will be the total earnings of Manny?
A. Php63,005
B. Php61,900
C. Php62,900
D. Php61,000

9. Rosie made an installment sale of Php21,000 monthly for 3 years. The company
promised her of 6.2% commission on this sale. How much will be her monthly
commission?
A. Php1,203
B. Php1,302
C. Php1,402
D. Php1,503

10. For every item that John sells, he will get a commission of 10%. He sold an item
worth Php223,000. How much did he earn?
A. Php20,300
B. Php21,300
C. Php22,300
D. Php24,300

11-15. Enumerate the Steps in Computing for a Commission.

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 Additional Activities

DIRECTIONS: On a separate sheet of paper, answer the problems below.

1. Your boss made a promise that you will get a 3.2% for every sale that you
make for her store. You sold products worth Php17,300. How much will be
your commission from this?

2. It is your birthday. The company gives an additional 3% bonus for you and
that is on top of the 7% commission rate for every sale that you can make.
Luckily, you sold an item worth Php135,000. How much will be your
commission for this day?

Good job!

We have successfully accomplished our mission for this

module!

I will see you on our next module!

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References
Lopez, B., Martin-Lundag, L. and Dagal, K., 2016. Business Math (Teacher's
Manual). Quezon City: Vibal Gro up , Inc.

Lopez, B . , Martin-Lundag, L. and Dagal, K., 2016. Business Math (Textbook).

Quezon City: Vibal Group, Inc.

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For inquiries or feedback, please write or call:

Department of Education – Region III,

Schools Division of Bataan - Curriculum Implementation Division
Learning Resources Management and Development Section (LRMDS)

Provincial Capitol Compound, Balanga City, Bataan

Telefax: (047) 237-2102

Email Address: bataan@deped.gov.ph

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