This document presents a group problem for students to solve. Raj must choose between two payment methods: 1) a 6% commission on all sales or 2) a $300 base salary plus 2% commission on any sales over $4,000. Students are asked to calculate Raj's pay under both methods if he sells $5,000 or $10,000, and recommend the better option along with factors for Raj to consider. Separate examples are given on straight and differential piecework payment systems. The document concludes with reading and question assignments.

1. Group Problem
You have 10 minutes to come up with an answer to this problem.
You may work in groups of 3 or 4.
Raj has to make a decision on how he would like to be paid. The
company has given him a choice. The first choice is a 6%
commission on any sales he makes, the second choice is a base
salary of $300.00 and a 2% commmission for any sales over
$4000.00.
a) If he sells $5000.00 what will his net pay be for both methods of
pay?
b) If he sells $10,000.00 what will his net pay be for both methods?
c) Which way do you think he should be paid? Give reasons.
d) List things he need to consider when he makes his choice.
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2. Straight Piecework
When an employee is paid the same amount for each piece, part,
or unit that he or she makes, this method of payment is referred to
as straight piecework. Consider the following example.
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3. Example 1
DJ packages condiments for the fast­food industry. She earns $0.08
for each package she assembles. If she assembles 4560 packages
during a week and 24 of them do not pass inspection, calculate her
gross income for the week.
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4. Differential Piecework
Employers can also pay employees based on a differential piecework
schedule. An employee is paid on a scale,where the amount earned
per piece increases as they produce more work.
This encourages employees to work quickly and accuratly.
The employee is only paid for accepted pieces.
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5. Example two
Ray Light assembles lamps. He works on a differential piecework
schedule.
One week Ray produces 274 lamps. Of these, all but 16 of them pass
inspection.
1. Calculate Ray’s gross wages for the week using the scale below.
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6. Assignment
Read page 22 ­ 24
Page 25 questions 3,4,6,7,9, 11
One of these questions will be a hand­in assignment
for tomorrow's class
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