Isaac earns a base salary of $1,250 per month and a graduated commission of 0.4% on the first $100,000 of sales, and 0.5% on sales over $100,000. Last month, Isaac's gross salary was $2025. What were his sales for the month?
A) $75,000
B) $200,000
C) $312,500
D) $250,000
E) $175,000

Question

Quizplus · Accepted Answer

Isaac's commission is the gross salary minus the base salary: $2025 - $1250 = $775. Since the commission rate increases after $100,000, we calculate based on the two rates. If Isaac's sales were $100,000 or less, the commission would be $100,000 * 0.4% = $400, which is less than $775, so his sales must be over $100,000. For sales over $100,000, the commission on the first $100,000 is $400 (0.4% of $100,000), and the remaining $375 of his commission comes from sales over $100,000 at a rate of 0.5%. To find the amount of sales over $100,000, we divide the remaining commission by the rate: $375 / 0.5% = $75,000. Therefore, his total sales were $100,000 + $75,000 = $175,000.

Isaac Earns a Base Salary of $1,250 Per Month and a Graduated