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Paul sells encyclopedias door-to-door. He earns $160 on every paycheck, regardless of how many sets he sells. In additio

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by Gmat_mission » Thu Sep 10, 2020 12:33 am

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Paul sells encyclopedias door-to-door. He earns $160 on every paycheck, regardless of how many sets he sells. In addition, he earns commission as follows:

Commission Sales
10% $0.00 - $10,000.00
5% $10,000.01 --->

He does not earn "double commission." That is, if his sales are $12,000, he earns 10% on the first $10,000 and 5% on the remaining $2,000.

His largest paycheck of the year was $1,320. What were his sales for that pay period?

A)13,200
B)14,800
C)16,400
D)15,800
E)19,600

Answer: A

Source: Veritas Prep
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Re: Paul sells encyclopedias door-to-door. He earns $160 on every paycheck, regardless of how many sets he sells. In add

by ravinikhil » Thu Sep 10, 2020 6:33 am
Let's just say,
he earned 1320$ on his best month
now he will get 160$ regardless of what he sells,
so let's subtract that amount to get the sales idea.
so now 1320 - 160 = 1160$
now since the money remaining is greater than 1000$ meaning he has earned a full 10% on his sales commission. hence he at least did a sales of 10000$ in that month,
lets go further
1160 - 1000 = 160$.
now he will need to do some amount of sales to get 5% commission on them which makes it total 160$

so , 5% of x = 160
x = 3200
hence total sales is 10000 + 3200 = 13200$ which is the ans
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Re: Paul sells encyclopedias door-to-door. He earns $160 on every paycheck, regardless of how many sets he sells. In add

by Scott@TargetTestPrep » Mon Sep 14, 2020 3:46 am
Gmat_mission wrote: ↑
Thu Sep 10, 2020 12:33 am
 Paul sells encyclopedias door-to-door. He earns $160 on every paycheck, regardless of how many sets he sells. In addition, he earns commission as follows:

Commission Sales
10% $0.00 - $10,000.00
5% $10,000.01 --->

He does not earn "double commission." That is, if his sales are $12,000, he earns 10% on the first $10,000 and 5% on the remaining $2,000.

His largest paycheck of the year was $1,320. What were his sales for that pay period?

A)13,200
B)14,800
C)16,400
D)15,800
E)19,600

Answer: A

Solution:

Since he earns $160 as base salary and 10% of $10,000 is $1,000, if he sells no more than $10,000 worth of encyclopedias, the maximum he earns is $1,160. However, since he earns $1,320, he must have sold more than $10,000 worth of encyclopedias. Therefore, if we let x = his sales for the paycheck of $1,320, we can create the equation:

160 + 0.1(10,000) + 0.05(x - 10,000) = 1,320

160 + 1,000 + 0.05x - 500 = 1,320

660 + 0.05x = 1,320

0.05x = 660

x = 13,200

Answer: A

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