Solving Commission Applications
Learning Outcomes
- Calculate sales commission given total purchase price and rate
- Calculate rate of commission given purchase price and commission earned
Sales people often receive a commission, or percent of total sales, for their sales. Their income may be just the commission they earn, or it may be their commission added to their hourly wages or salary. The commission they earn is calculated as a certain percent of the price of each item they sell. That percent is called the rate of commission.
Commission
A commission is a percentage of total sales as determined by the rate of commission. [latex-display]\text{commission}=\text{rate of commission}\cdot \text{total sales}[/latex-display]example
Helene is a realtor. She receives [latex]\text{3%}[/latex] commission when she sells a house. How much commission will she receive for selling a house that costs [latex]\text{\$260,000}?[/latex] SolutionIdentify what you are asked to find. | What is the commission? |
Choose a variable to represent it. | Let [latex]c=[/latex] the commission. |
Write a sentence that gives the information to find it. | The commission is [latex]3\text{%}[/latex] of the price. |
Translate into an equation. | |
Simplify. | [latex]c=7800[/latex] |
Change to percent form. | [latex]r=8.5\text{%}[/latex] |
Check. Is this answer reasonable? | |
Yes. [latex]1\text{%}[/latex] of [latex]\text{\$260,000}[/latex] is [latex]\text{\$2,600}[/latex], and [latex]\text{\$7,800}[/latex] is three times [latex]\text{\$2,600}[/latex]. | |
Write a complete sentence that answers the question. | Helene will receive a commission of [latex]\text{\$7,800}[/latex]. |
try it
[ohm_question]146752[/ohm_question]example
Rikki earned [latex]\text{\$87}[/latex] commission when she sold a [latex]\text{\$1,450}[/latex] stove. What rate of commission did she get?Answer: Solution
Identify what you are asked to find. | What is the rate of commission? |
Choose a variable to represent it. | Let [latex]r=[/latex] the rate of commission. |
Write a sentence that gives the information to find it. | The commission is what percent of the sale? |
Translate into an equation. | |
Divide. | [latex]\frac{87}{1450}=\frac{1450r}{1450}[/latex] |
Simplify. | [latex]0.06=r[/latex] |
Change to percent form. | [latex]r=6\text{%}[/latex] |
Check if this answer is reasonable. | |
Yes. A [latex]10\text{%}[/latex] commission would have been [latex]\text{\$145}[/latex]. The [latex]6\text{%}[/latex] commission, [latex]\text{\$87}[/latex], is a little more than half of that. | |
Write a complete sentence that answers the question. | The commission was [latex]6\text{%}[/latex] of the price of the stove. |
try it
[ohm_question]146754[/ohm_question]Licenses & Attributions
CC licensed content, Original
- Question ID 146754, 146752. Authored by: Lumen Learning. License: CC BY: Attribution.
CC licensed content, Shared previously
- Ex: Percent Application - Commission Amount Given Percent of Sales (Equation and Proportion). Authored by: James Sousa (Mathispower4u.com). License: CC BY: Attribution.
CC licensed content, Specific attribution
- Prealgebra. Provided by: OpenStax License: CC BY: Attribution. License terms: Download for free at http://cnx.org/contents/[email protected].