Skill: Calculate gross pay from different compensation structures

Gross pay is the total amount earned before taxes, insurance, or other deductions. First, identify the pay structure and then use the matching model:

• Hourly pay:

$$\text{gross pay}=\text{hourly rate}\times\text{hours worked}$$

• Salary:

$$\text{pay per period}=\frac{\text{annual salary}}{\text{number of pay periods per year}}$$

• Commission:

$$\text{commission}=\text{sales}\times\text{commission rate}$$

• Base pay plus commission:

$$\text{gross pay}=\text{base pay}+\text{commission}$$

Worked example

Maya earns a weekly base pay of 500$plus a$4%$commission on her sales. This week, she sells$$3{,}200$ worth of products. Find her gross pay.

Step 1: Calculate the commission.

Convert $4\%$ to a decimal:

$$4\%=0.04$$

Then multiply by her sales:

$$\text{commission}=0.04\times \$3{,}200=\$128$$

Step 2: Add the base pay.

$$\text{gross pay}=\$500+\$128=\boxed{\$628}$$

Maya’s gross pay is 628$. If taxes or other deductions are taken out, the amount she receives is her **take-home pay**, which would be less than$$628$.