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glencoe_accounting_chp12

# Juans sales were 4810 last week his gross earnings

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Unformatted text preview: ast week. His gross earnings are \$344.30 [\$200 (\$4,810 .03)]. Piece Rate Some manufacturing companies pay employees a specific amount of money for each item the employee produces. This method of payment is called piece rate . Businesses often pay a low hourly rate in addition to the piece rate. Overtime Pay State and federal laws regulate the number of hours some employees may work in a week. Generally, employers are required to pay overtime when employees covered by these laws work more than 40 hours per week. The overtime rate , set by the Fair Labor Standards Act of 1938, is 1½ (1.5) times the employee’s regular hourly pay rate. For example, Jesse Dubow, a photo-lab clerk at Fast Photo, worked 43 hours last week. Jesse’s hourly rate of pay is \$6.60. His hourly overtime rate is \$9.90 (\$6.60 1.5). His gross earnings for the week are \$293.70 determined as follows: Regular Overtime Total Hours 40 3 Rate \$6.60 \$9.90 Hours 4 READ In Your Experience \$264.00 29.70 \$293.70 Some employees who are paid a salary are also entitled to overtime pay. If a salaried employee is paid overtime, the salary is converted to an hourly rate using a standard number of hours for the period covered by the salary. Then the hourly overtime rate is calculated. For example, Jim Halley’s salary is \$600 per week. His hourly rate is \$15 assuming a standard 40-hour work week (\$600 40). His hourly overtime rate is \$22.50 (\$15 1.5). Jim’s gross earnings for a 44-hour week are \$690, determined as follows: Regular Overtime Total AS YOU Pay Categories If you or your friends have parttime jobs, what is the pay category? Rate \$22.50 \$600.00 90.00 \$690.00 Section 1 Calculating Gross Earnings 308-337_CH12_868829.indd 313 313 9/15/05 11:43:45 AM Assessment SECTION 1 AFTER YOU READ Reinforce the Main Idea Create a table similar to this one. For each category of employee, list the source of information for calculating gross earnings in a single pay period. Do the Math You have been interviewing with several financial consulting firms for entry-level management positions, and you received two job offers. One company, Bryson Consulting, of...
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