COMMISSIONS

AND INTERESTS

Chapter 4
Lesson 1 : Commissions
commission A commission is payment used mainly for salespeople.

Steps to compute Commission and total pay

Step 1. multiply the commission rate by the amount sold to
get the amount of commission.
commission = amount sold × rate of commission
Step 2. If there is a salary, add it to the commission
amount to get the total gross pay.
total gross pay = salary + commission
example A salesman sells a used car for ₱95,000. his commission
rate is 4%. What will be his commission for the sale?

Maria, a computer salesperson is paid a retainer’s fee of

₱5,350 per week, plus a commission of 8% of profits made
by the company on computers that she sells. How much
does she earn in a week if ₱15,000 profit was generated
by her sales?
example Ana receives 25% commission on the appliances she sells.
If she sells TV for ₱11,170, a refrigerator for ₱6,545 and an
air-conditioning unit for ₱14,890, how much does Ana
make in commission?

A clerk sold ₱3,500 in merchandise during 1 week. If he

received a commission of ₱140, what was the rate of
commission?
commission A commission is payment used mainly for salespeople.

Steps to compute Commission based on quota and total pay

Step 1. subtract the quota from the amount sold and
multiply the commission rate to get the amount of
commission.
commission = (amount sold – quota) × rate of
commission
Step 2. If there is a salary, add it to the commission
amount to get the total gross pay.
total gross pay = salary + commission
example Juan works as a Salesman in an electronics shop. He earns
a weekly salary of ₱4,250 plus a 3 % commission on sales
over ₱20,000 per week. If Juan’s sales in one week reaches
₱35,000, what are his gross pay for the week?
commission A commission is payment used mainly for salespeople.

Steps to compute Commission under a graduated rate plan

Step 1. calculate each level’s commission; multiply each
level’s sales by the level’s commission rate.
Step 2. add the products computed in step 1 to determine
the total commission.
example Sonia works as a salesperson. She earns 5% commission
on the first ₱10,000 of sales, and 8% on any sale above
₱10,000 for the week. How much did Sonia earn in
commission in a week if her sales reaches ₱25,000?

A real state agency receives 2% commission on the first

₱1,000,000 of sales and 3% on the remainder. How much
commission is received on the sale of a ₱2,800,000
property?

Anna has a monthly commission plan under which she

receives 2% on the first ₱40,000 of sales during the
month, 3% on the sales from ₱40,000 to ₱80,000, and 4%
on all sales over ₱80,000. if Anna has sales of ₱126,000
during a month, compute her commission for that month.