This is a very basic calculation revolving around percentages. Just take the sale price, multiply it by the commission percentage, and divide it by 100. An example calculation: a blue widget is sold for $70. The salesperson works on a commission — they get 14% out of every transaction, which amounts to $9.80.
So the formula is:
commission amount = sale price × commission percentage / 100.
So now you know how to calculate commission. Now that you have this figure, there's a problem with who will cover this cost — usually, it's the selling party (whoever hired the salesperson to do the job). To calculate their revenue, we need to calculate the percentage decrease:
real revenue = sale price - sale price × commission percentage / 100. In our example, it's$70 - $70 × 14 / 100 = $70 - $9.80 = $60.20.
It's not very common, but sometimes it's the buyer who pays for the salesperson's remuneration. In those cases, we need the percentage increase formula:
price with commission = base price + base price × commission percentage / 100. In our example, it's $70 + $70 × 14 / 100 = $70 + $9.80 = $79.80.
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The article revolves around basic percentage calculations, specifically focusing on commissions in sales transactions. The formula for calculating the commission amount is given as follows:
[ \text{Commission Amount} = \frac{\text{Sale Price} \times \text{Commission Percentage}}{100} ]
In the example provided, a blue widget is sold for $70, and the salesperson receives a 14% commission, resulting in a commission amount of $9.80.
To calculate the real revenue after factoring in the commission, the formula is:
[ \text{Real Revenue} = \text{Sale Price} - \frac{\text{Sale Price} \times \text{Commission Percentage}}{100} ]
In the given example, the real revenue is $60.20.
The article also discusses scenarios where the cost of the commission may be covered by either the selling party or the buyer. If the selling party covers the cost, the formula for the price with commission is:
[ \text{Price with Commission} = \text{Base Price} + \frac{\text{Base Price} \times \text{Commission Percentage}}{100} ]
In the example, if the buyer covers the commission, the price with commission would be $79.80.
In summary, the article provides a comprehensive understanding of commission calculations in sales transactions, covering scenarios where the selling party or the buyer bears the cost. The formulas presented allow for accurate computation of commission amounts, real revenue, and adjusted prices based on the specified commission percentages.
