Week 10 - Salaries and Wages PDF

ABM 001 BUSINESS MATHEMATICS Salaries and Wages Prepared by: Mr. John Michael M. Sabater  Learning Content At the end of this module, you will be able to: Define salary, wage and benefits. Compute gross and net earnings. Differentiate gross from net earnings. Compensa...

ABM 001 BUSINESS MATHEMATICS Salaries and Wages Prepared by: Mr. John Michael M. Sabater  Learning Content At the end of this module, you will be able to: Define salary, wage and benefits. Compute gross and net earnings. Differentiate gross from net earnings. Compensation - way to provide monetary value to employees in exchange of their work/service performed. - usually presented in Payroll - the total amount required to pay workers and employees during a week, month or other period. - defined as the total sum of money to be paid out to  Gross Pay (Gross Earning) - total amount of employees earnings before deductions have Wage been maid by the - the monetary employers remuneration computed on hourly, daily, weekly, or piece work basis. SALARY - fixed weekly or monthly wage - also be computed in prorating annual salary or time basis pay or by piece work.  Computation of salaries Other way of computing the remuneration of employees by using the formula for EMR (Equivalent Monthly Rate) of monthly paid employees is:  Example 1 For an employee who earns an annual of Php. 260,000, what is the (a) weekly salary? (b) biweekly salary? (c) semi-monthly salary? (d) monthly salary?  Solution: A. B.  Solution: C. D.  Time Basis Pay Most of the time, especially in office related works, employees’ earnings is based on time worked. The compensation is usually stated as specific rate per hour, day, week, month, or year. It is computed 11 by:  Example 1 Rojen Mae Yap receives Php. 82.50 an hour and works for 37 hours this week. Find her gross pay. Solution: Given: Hourly Rate = Php. 82.50 Number of Hours Worked = 37 Thus, her total gross pay is Php. 3,052.50.  Example 2 Maren was paid Php. 76.30 per hour. Find her gross earnings for the week during which she worked 44 hours. Solution: Given: Hourly Rate = Php. 76.30 Number of Hours Worked = 44 Thus, Maren’s total gross pay is Php. 3,357.20.  Example 3 Dexter receives a daily wage of Php. 521.60. How much does he earns in a week if he worked for 5 days? Solution: Given: Daily Rate = Php. 521.60 Number of Days Worked = 5 Thus, his weekly pay is Php. 2,608.  Piece-Rate Pay Workers on factories and industries are often paid according to the number of pieces/units they produce which is usually called piecework or piece-rate pay. In some cases, workers who produces/sells more than the standard quota of units were given incentives.  Piece-Rate Pay If production/sales does not meet or exceed the quota, they only paid on standard wage. The following formula are; 17  Example 4 Assume Rodel Morada is paid Php. 14 for every small bag he makes, if he produced 250 small bags, what are his total earnings? Solution: Given: Rate per Piece = Php. 14 Number of items produced = 250 Thus, Rodel’s total earning is Php. 3,500.  Example 5 Gregorio’s daily production is 105 units during an 8-hour work for which he is paid Php. 86.20 an hour. He receives a premium for the extra units he produces during the day of work. Find his gross pay for a) a day when he produced 100 units; and b) another day when he produced 130 units. A. Solution: Given: No. of Working hours = 8 hours Rate per hour = Php. 86.20 Note that the units produced do not exceed the quota. Thus, he will only receive his standard pay of: B. The 130 units of production is more than the prescribed quota of 105 units. There is an extra 25 units, then the total pay is: