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Grade 10 Essential Math Personal Finance UNIT 2: PERSONAL FINANCE Introduction In this unit, you will learn to calculate your gross earnings for when you start a job. There are many methods of being paid for your work, many of which will be examined in this unit. Some jobs require workers to “punch” a time card, or more commonly scan the bar code on their name tags. The bar code machine records exactly when the employees actually start work each day, and the length of time they are on the job. You will use time cards to calculate gross pay. Methods of Earning Income The pay that people receive for working is determined a number of ways. You can be paid on an hourly rate (a wage). Some people earn a salary, which is a set amount of money regardless of how many hours they work. People can earn money by working piecework; they earn money based on how much they can produce in a day. Finally, people can also earn money by working on commission which is a certain percentage of what they sell. Some examples of jobs that use these different methods to pay employees are: a day-care worker is paid an hourly wage a member of parliament is paid a salary a factory worker could be paid by piecework a car salesman may work on commission Income Various methods of earning income include hourly wages, salary, contract, commission, salary plus commission, and piecework. Your total income is called gross pay. Assessment: o o o o o o o o o Learning Activity 2.1: Wages Learning Activity 2.2: Overtime Pay o Lesson 1 Assignment: Gross Pay and Overtime Pay Learning Activity 2.3: Commission Learning Activity 2.4: Piecework and Contract o Lesson 2 Assignment: Alternative Ways to Earn an Income Learning Activity 2.5: Time Cards Learning Activity: 2.6 Late Penalties o Lesson 3 Assignment: Time Cards and Penalties Lesson 4 Assignment: Additional Earnings Lesson 5 Assignment: Changes in Income Lesson 6 Assignment: Net Income Personal Finance Project Test: Unit 2 Personal Finance 1 Grade 10 Essential Math Personal Finance LESSON 1: GROSS INCOME Lesson Introduction All of us have to work for a living. Depending on your career choices, you can make money in a variety of ways. This lesson examines the various methods of earning an income. Wages Many students find part-time work while they finish school. This provides some income to pay for entertainment or personal items like clothing and cell phone usage. Others work to save money to go on to university or college after graduation from Grade 12. Most commonly, students are paid an hourly wage. The more hours worked, the more income earned. Typically these jobs are found in retail or food service. Note: If you are paid an hourly rate and you work over your regular number of hours, you may get paid overtime. Some companies pay their employees time and a half (1.5) for hours that are over their regular time, others may get double (2) time. Income is how much money you earn. Your gross income is what you earn before deductions. Your net income is what you get after deductions (often called your ‘take home pay’). Examples: Sue was hired as an office clerk and is paid and annual salary of $34,756. a. What is her bi-weekly pay? b. What is her monthly pay? Solution: Recall: Biweekly means you get paid every two weeks. There are 26 bi-weekly pay periods in a year. Weekly means you get paid each week, there are 52 weeks in a year. $34 756 a. 𝑏𝑖 − 𝑤𝑒𝑒𝑒𝑘𝑙𝑦 𝑝𝑎𝑦 = 26 = $1 336.77 b. 𝑚𝑜𝑛𝑡ℎ𝑙𝑦 = c. 𝑤𝑒𝑒𝑘𝑙𝑦 = $34 7560 12 $34 756 52 = $2896.33 = $668.38 Example: Carlos works as a nurse, averaging 38.75 hours per week. He is paid $33.50 per hour. Find his gross pay. Solution: 𝐺𝑟𝑜𝑠𝑠 𝑃𝑎𝑦 = (𝑟𝑎𝑡𝑒 𝑝𝑒𝑟 ℎ𝑜𝑢𝑟)(𝑁𝑢𝑚𝑏𝑒𝑟 𝑜𝑓 ℎ𝑜𝑢𝑟𝑠) 𝑔𝑟𝑜𝑠𝑠 𝑝𝑎𝑦 = $33.50 𝑥 38.75 = $1298.13 2 Grade 10 Essential Math Personal Finance Example: You work at a local clothing retail store and are paid $8.50 an hour. If your hours for this week are: M – 5, T – 4, W – 4.5, T – 3.5 F – 3.5, what is your gross pay for the week? Solution: 𝑡𝑜𝑡𝑎𝑙 ℎ𝑜𝑢𝑟𝑠 = 5 + 4 + 4.5 + 3.5 + 3.5 = 20.5 𝐺𝑟𝑜𝑠𝑠 𝑃𝑎𝑦 = (𝑟𝑎𝑡𝑒 𝑝𝑒𝑟 ℎ𝑜𝑢𝑟)(𝑁𝑢𝑚𝑏𝑒𝑟 𝑜𝑓 ℎ𝑜𝑢𝑟𝑠) 𝑔𝑟𝑜𝑠𝑠 𝑝𝑎𝑦 = $8.50 𝑥 20.5 = $174.25 Learning Activity 2.1: Wages 1. Rachel works 40 hours a week as a journeyman printer. She earns $12.45 an hour, what are her weekly gross earnings? What is her annual salary (52 weeks in a year)? 2. Last year, Ryan earned $45,183.46 working at a high end salon. What was his monthly income? 3. Lotta Selling works at Cornwall Furniture. She is paid a straight hourly wage of $12.42. a. What is her weekly income if she works 35 hours? b. What is her monthly income (hint: change to annual income then change to monthly)? 4. Mr. McMichael teaches history at the local high school. His annual salary is $68,350.00. Find his weekly gross pay. 3 Grade 10 Essential Math Personal Finance Overtime After a 40-Hour Work Week Perhaps the most common policy is the 40-hour work week. Employees will be paid regular pay for the first 40 hours of work in a week. Any hours worked beyond the 40 hours is considered as overtime, and is paid at time and a half. Example: You are paid $9.75 an hour and time and a half for any hours worked over 40 hours. Calculate your last week’s wages from the following time card for last week. Monday 7 Tuesday 9 Wednesday 9 Thursday 10 Friday 6 Saturday 4 Solution: 𝑡𝑜𝑡𝑎𝑙 ℎ𝑜𝑢𝑟𝑠 = 7 + 9 + 9 + 10 + 6 + 4 = 45 𝑅𝑒𝑔𝑢𝑙𝑎𝑟 ℎ𝑜𝑢𝑟𝑠 = 40 𝑅𝑒𝑔𝑢𝑙𝑎𝑟 𝑅𝑎𝑡𝑒 𝑝𝑒𝑟 𝐻𝑜𝑢𝑟 = $9.75 𝑅𝑒𝑔𝑢𝑙𝑎𝑟 𝑃𝑎𝑦 = (𝑅𝑒𝑔 𝑟𝑎𝑡𝑒 𝑝𝑒𝑟 ℎ𝑜𝑢𝑟)(𝑁𝑢𝑚𝑏𝑒𝑟 𝑜𝑓 ℎ𝑜𝑢𝑟𝑠) 𝑅𝑒𝑔𝑢𝑙𝑎𝑟 𝑃𝑎𝑦 = $9.75 𝑥 40ℎ𝑟𝑠 = $390 𝑂𝑣𝑒𝑟𝑡𝑖𝑚𝑒 ℎ𝑜𝑢𝑟𝑠 = 5 𝑂𝑣𝑒𝑟𝑡𝑖𝑚𝑒 𝑅𝑎𝑡𝑒 𝑝𝑒𝑟 𝐻𝑜𝑢𝑟 = $9.75 𝑥 1.5 = $14.63 𝑂𝑇 𝑃𝑎𝑦 = (𝑂𝑇 𝑟𝑎𝑡𝑒 𝑝𝑒𝑟 ℎ𝑜𝑢𝑟)(𝑁𝑢𝑚𝑏𝑒𝑟 𝑜𝑓 𝑂𝑇 ℎ𝑜𝑢𝑟𝑠) 𝑂𝑣𝑒𝑟𝑡𝑖𝑚𝑒 𝑃𝑎𝑦 = $14.63 𝑥 5 = $73.15 𝐺𝑟𝑜𝑠𝑠 𝑃𝑎𝑦 = $390 + $73.15 = $463.15 4 Grade 10 Essential Math Personal Finance Example: Your workplace demands that you put in many hours, and you are paid $10.25 per hour. But your employer will pay you time and a half for any hours over 40 in a week, and double time for any hours worked on Sunday. Here is a record of the hours you worked each day. Find your week’s gross pay. Monday 6 Tuesday 10 Wednesday 8 Thursday 8 Friday 9 Saturday 4 Sunday 4 Solution: 𝑡𝑜𝑡𝑎𝑙 ℎ𝑜𝑢𝑟𝑠 = 6 + 10 + 8 + 8 + 9 + 4 = 45 𝑆𝑢𝑛𝑑𝑎𝑦 𝐻𝑜𝑢𝑟𝑠 = 4 𝑅𝑒𝑔𝑢𝑙𝑎𝑟 ℎ𝑜𝑢𝑟𝑠 = 40 𝑅𝑒𝑔𝑢𝑙𝑎𝑟 𝑅𝑎𝑡𝑒 𝑝𝑒𝑟 𝐻𝑜𝑢𝑟 = $10.25 𝑅𝑒𝑔𝑢𝑙𝑎𝑟 𝑃𝑎𝑦 = (𝑅𝑒𝑔 𝑟𝑎𝑡𝑒 𝑝𝑒𝑟 ℎ𝑜𝑢𝑟)(𝑁𝑢𝑚𝑏𝑒𝑟 𝑜𝑓 ℎ𝑜𝑢𝑟𝑠) 𝑅𝑒𝑔𝑢𝑙𝑎𝑟 𝑃𝑎𝑦 = $10.25 𝑥 40ℎ𝑟𝑠 = $410 𝑂𝑣𝑒𝑟𝑡𝑖𝑚𝑒 ℎ𝑜𝑢𝑟𝑠 = 5 𝑂𝑣𝑒𝑟𝑡𝑖𝑚𝑒 𝑅𝑎𝑡𝑒 𝑝𝑒𝑟 𝐻𝑜𝑢𝑟 = $10.25 𝑥 1.5 = $15.38 𝑂𝑇 𝑃𝑎𝑦 = (𝑂𝑇 𝑟𝑎𝑡𝑒 𝑝𝑒𝑟 ℎ𝑜𝑢𝑟)(𝑁𝑢𝑚𝑏𝑒𝑟 𝑜𝑓 𝑂𝑇 ℎ𝑜𝑢𝑟𝑠) 𝑂𝑣𝑒𝑟𝑡𝑖𝑚𝑒 𝑃𝑎𝑦 = $15.38 𝑥 5 = $76.90 𝑆𝑢𝑛𝑑𝑎𝑦 𝑅𝑎𝑡𝑒 𝑝𝑒𝑟 ℎ𝑜𝑢𝑟 = $10.25 𝑥 2 = $20.50 𝑆𝑢𝑛𝑑𝑎𝑦 𝑃𝑎𝑦 = $20.50 𝑥 4 = $82 𝐺𝑟𝑜𝑠𝑠 𝑃𝑎𝑦 = $410 + $76.90 + $82 = $568.90 5 Grade 10 Essential Math Personal Finance Example: Your employer pays overtime on any time worked over 8 hours per day, and on any hours worked on Saturday. Your regular wage is $9.85 per hour. Calculate your gross pay given the following schedule. Monday 9.25 Tuesday 8 Wednesday 10 Thursday 5 Friday 5 Saturday 3 Solution: 𝑅𝑒𝑔𝑢𝑙𝑎𝑟 ℎ𝑜𝑢𝑟𝑠 = 8 + 8 + 8 + 5 + 5 = 34 𝑅𝑒𝑔𝑢𝑙𝑎𝑟 𝑃𝑎𝑦 = (𝑅𝑒𝑔 𝑟𝑎𝑡𝑒 𝑝𝑒𝑟 ℎ𝑜𝑢𝑟)(𝑁𝑢𝑚𝑏𝑒𝑟 𝑜𝑓 ℎ𝑜𝑢𝑟𝑠) 𝑅𝑒𝑔𝑢𝑙𝑎𝑟 𝑃𝑎𝑦 = $9.85 𝑥 34 = $334.90 𝑂𝑣𝑒𝑟𝑡𝑖𝑚𝑒 𝐻𝑜𝑢𝑟𝑠 = 1.25 + 2 + 3 = 6.25 𝑂𝑣𝑒𝑟𝑡𝑖𝑚𝑒 𝑅𝑎𝑡𝑒 𝑝𝑒𝑟 𝐻𝑜𝑢𝑟 = $9.85 𝑥 1.5 = $14.78 𝑂𝑇 𝑃𝑎𝑦 = (𝑂𝑇 𝑟𝑎𝑡𝑒 𝑝𝑒𝑟 ℎ𝑜𝑢𝑟)(𝑁𝑢𝑚𝑏𝑒𝑟 𝑜𝑓 𝑂𝑇 ℎ𝑜𝑢𝑟𝑠) 𝑂𝑣𝑒𝑟𝑡𝑖𝑚𝑒 𝑃𝑎𝑦 = $14.78 𝑥 6.25 = $92.38 𝐺𝑟𝑜𝑠𝑠 𝑃𝑎𝑦 = $334.90 + $92.38 = $427.28 Learning Activity 2.2: Overtime Pay 1. Tim earns an hourly wage of $8.25 at a local grocery store. His normal work week is 40 hours. If he works over that, he gets paid time and one half in overtime pay. What is his gross pay for a week that he works 47 hours this week? 2. Wesley works at a pizza place as a cook and makes $9.75 an hour. He gets paid overtime pay of time and one half if he works more than 7 hours a day. If Wesley works the following hours this week, how much does he get paid this week? M – 7.5 T – 8, W – 7, Th – 7, F – 8 3. Calculate the gross income for the following employee if his hourly wage is $11.26 and overtime is paid at time and one-half on all hours worked over 40 per week and on any Saturday hours. Double time is paid for any hours worked on Sunday. Monday 8 Tuesday 10.75 Wednesday 8.5 Thursday 9 Friday 8 Saturday 4 Sunday 4.5 6 Grade 10 Essential Math Personal Finance Curriculum Outcomes: 10E1.P.1. Demonstrate an understanding of calculations for gross pay and net pay earned through income sources including: wages, salary, contracts, commissions, piecework Lesson 1 Assignment: Gross Pay and Overtime Pay SEE YOUR TEACHER FOR LESSON 1 ASSIGNMENT 7 Grade 10 Essential Math Personal Finance LESSON 2: ALTERNATIVE WAYS TO EARN AN INCOME Lesson Focus In this lesson, you will identify various methods of earning income demonstrate an understanding of calculations for gross pay Lesson Introduction All of us have to work for a living. Depending on your career choices, you can make money in a variety of ways. This lesson examines the various methods of earning income. Commission Some of the highest paid sales people in Canada are paid strictly on commission where they are paid a percentage of their sales. If you are comfortable talking with people and have a popular product to sell, you can make a nice income on commission. But the reverse can also be true if sales are slow. People who sell real estate, life insurance, and automobiles are usually paid on commission. However, if the economy is bad, and people are not purchasing as much, commissions are low. Example: Charlie is paid 1.5% commission on house sales. Last week he sold 3 homes, valued at $95,000, $130,000, and $175,500. Find his gross pay for last week. Solution: 𝑡𝑜𝑡𝑎𝑙 𝑠𝑎𝑙𝑒𝑠 = $95,000 + $130,000 + $175,500 = $400,500 𝐶𝑜𝑚𝑚𝑖𝑠𝑠𝑖𝑜𝑛 𝑟𝑎𝑡𝑒 = 1.5% = 0.015 𝐶𝑜𝑚𝑚𝑖𝑠𝑠𝑖𝑜𝑛 = (𝑆𝑎𝑙𝑒𝑠)(𝑐𝑜𝑚𝑚𝑖𝑠𝑠𝑖𝑜𝑛 𝑟𝑎𝑡𝑒) 𝐺𝑟𝑜𝑠𝑠 𝑃𝑎𝑦 = $400 500 𝑥 0.015 = $6007.05 This is a high weekly salary compared to what most other jobs pay, but remember that if Charlie sold no houses, he would receive no income. Example: Sarah is working in an ice cream store. She is paid strictly on commission at the rate of 22% of all sales she makes. If her sales during one freezing week last February were $180, find her gross income for that week. Solution: 𝐶𝑜𝑚𝑚𝑖𝑠𝑠𝑖𝑜𝑛 = (𝑆𝑎𝑙𝑒𝑠)(𝑐𝑜𝑚𝑚𝑖𝑠𝑠𝑖𝑜𝑛 𝑟𝑎𝑡𝑒) 𝐶𝑜𝑚𝑚𝑖𝑠𝑠𝑖𝑜𝑛 = $180 𝑥 0.22 = $39.60 8 Grade 10 Essential Math Personal Finance Salary plus Commission Some businesses, such as big department stores, will pay sales staff a base salary plus a commission. This ensures the staff will at least have some income each week when sales are slow. Example: Brian is a salesman in a store selling top quality home furnishings and earns a salary plus a commission. The owner pays Brian a base salary of $450 per week, plus 5% commission on all his sales. If Brian sold $12,275 in furnishings last week, find his gross pay for the week. Solution: 𝐵𝑎𝑠𝑒 𝑆𝑎𝑙𝑎𝑟𝑦 = $450 𝑐𝑜𝑚𝑚𝑖𝑠𝑠𝑖𝑜𝑛 = (𝑆𝑎𝑙𝑒𝑠)(𝑐𝑜𝑚𝑚𝑖𝑠𝑠𝑖𝑜𝑛 𝑟𝑎𝑡𝑒) 𝑐𝑜𝑚𝑚𝑖𝑠𝑠𝑖𝑜𝑛 = $12 275 𝑥 0.05 = $613.75 𝐺𝑟𝑜𝑠𝑠 𝑝𝑎𝑦 = $450 + $613.75 Example: Meghan sells appliances for a major department store. She receives a monthly salary of $850 plus 3% commission on her sales. If this week’s sales were $6800, find her gross weekly income. Solution: 𝑆𝑡𝑒𝑝 1: 𝐶𝑜𝑛𝑣𝑒𝑟𝑡 𝑡ℎ𝑒 𝑏𝑎𝑠𝑒 𝑚𝑜𝑛𝑡ℎ𝑙𝑦 𝑠𝑎𝑙𝑎𝑟𝑦 𝑖𝑛𝑡𝑜 𝑎𝑛 𝑤𝑒𝑒𝑘𝑙𝑦 𝑠𝑎𝑙𝑎𝑟𝑦. 𝑊𝑒 𝑚𝑢𝑠𝑡 𝑐𝑜𝑛𝑣𝑒𝑟𝑡 𝑡𝑜 𝑎𝑛 𝑎𝑛𝑛𝑢𝑎𝑙 𝑠𝑎𝑙𝑎𝑟𝑦 𝑓𝑖𝑟𝑠𝑡, 𝑡ℎ𝑒𝑛 𝑤𝑒 𝑐𝑜𝑛𝑣𝑒𝑟𝑡 𝑡𝑜 𝑤𝑒𝑒𝑘𝑙𝑦. 𝐴𝑛𝑛𝑢𝑎𝑙 𝑠𝑎𝑙𝑎𝑟𝑦 = $850 𝑥 12 = $10 200 $10 200 𝑤𝑒𝑒𝑘𝑙𝑦 𝑠𝑎𝑙𝑎𝑟𝑦 = = $196.15 12 𝑆𝑡𝑒𝑝 2: 𝐶𝑎𝑙𝑐𝑢𝑙𝑎𝑡𝑒 𝑡ℎ𝑒 𝑐𝑜𝑚𝑚𝑖𝑠𝑠𝑖𝑜𝑛. 𝑐𝑜𝑚𝑚𝑖𝑠𝑠𝑖𝑜𝑛 = $6800 𝑥 0.03 = $204 𝑆𝑡𝑒𝑝 3: 𝐹𝑖𝑛𝑑 𝑡ℎ𝑒 𝑡𝑜𝑡𝑎𝑙 𝑤𝑒𝑒𝑘𝑙𝑦 𝑝𝑎𝑦 𝑡𝑜𝑡𝑎𝑙 𝑤𝑒𝑒𝑘𝑙𝑦 𝑝𝑎𝑦 = $196.15 + $204 = $400.15 9 Grade 10 Essential Math Personal Finance Learning Activity 2.3: Commission 1. Bob is a car salesman and earns a straight commission of 7.5% of his total sales. If Bob sold 3 cars this past month and they cost $17,475; $30,330; and $36,715 how much did Bob earn last month? 2. Sara is also a salesman. She earns $350 each week plus 6% commission on any amount of sales over $20,000. If she had $62,000 in sales this month, what is her gross pay? 3. A car salesperson is paid 1 % commission on all sales. If her sales totalled $74,380, find her gross income. 4. An appliance salesperson earns a base salary of $300 per week, plus 4% commission on his sales. If his sales totalled $6845 for two months, find his monthly earnings. 10 Grade 10 Essential Math Personal Finance Piecework Another method of earning income is through piecework. You are paid for the number of things you make. If you are working in a garment factory, sewing zippers onto jackets, you might get paid an amount for each zipper properly sewn. Piecework income encourages workers to apply themselves and not waste time. Some companies deduct pay for pieces not assembled properly. Example: Hubert is paid $5 for every bike he assembles and puts on the rack at the local Bike*Mart store. The manager deducts $3.50 off his pay for each bike placed on the rack that is not assembled properly. Calculate Hubert’s weekly gross income if he assembled 120 bikes, but had 26 rejected by the manager. Solution: 𝑃𝑎𝑦 𝑓𝑜𝑟 𝑡ℎ𝑒 𝑏𝑖𝑘𝑒𝑠 𝑎𝑠𝑠𝑒𝑚𝑏𝑙𝑒𝑑 = $5 𝑥 120 = $600 𝐷𝑒𝑑𝑢𝑐𝑡𝑖𝑜𝑛𝑠 𝑓𝑜𝑟 𝑖𝑚𝑝𝑟𝑜𝑝𝑒𝑟 𝑎𝑠𝑠𝑒𝑚𝑏𝑙𝑦 = $3.50 𝑥 26 = $91 𝑔𝑟𝑜𝑠𝑠 𝑝𝑎𝑦 = $600 − $91 = $509 Example: Shauna has a job assembling phone packages into boxes. She has to insert the phone, the cords, and the power supply. Then the box is closed and sent down the line for shipping. She is paid $0.75 for each box packaged, and has $0.50 deducted for any faulty packaging. Find her weekly gross pay if she packaged 580 boxes, but had 96 returned. Solution: 𝑃𝑎𝑦 𝑓𝑜𝑟 𝑡ℎ𝑒 𝑝𝑎𝑐𝑘𝑎𝑔𝑒𝑠 = $0.75 𝑥 580 = $435 𝐷𝑒𝑑𝑢𝑐𝑡𝑖𝑜𝑛𝑠 𝑓𝑜𝑟 𝑓𝑎𝑢𝑙𝑡𝑦 𝑝𝑎𝑐𝑘𝑎𝑔𝑒𝑠 = $050 𝑥 96 = $48 𝑔𝑟𝑜𝑠𝑠 𝑝𝑎𝑦 = $435 − $48 = $387 Contract Examples of companies using a contract are companies that do driveway installations, home renovations, property landscaping, or roofing. Many contractors will have you sign a contract in which you promise to pay them a fixed amount upon completion of the job. Most will also agree on a contract without considering the number of hours needed to complete the job. Example: John is a painter and has negotiated a contract with a homeowner to paint the exterior of the house. His rate is $30/hour plus the cost of the materials. He takes three days at 6 hours a day to paint and uses 15 gallons of paint that cost $45 each. What is the cost that he will charge the homeowner? Solution: 𝑤𝑎𝑔𝑒 = ($30)(6 ℎ𝑜𝑢𝑟𝑠)(3𝑑𝑎𝑦𝑠) = $540 𝑚𝑎𝑡𝑒𝑟𝑖𝑎𝑙 𝑐𝑜𝑠𝑡 = ($45)(15) = $675 𝑡𝑜𝑡𝑎𝑙 𝑐𝑜𝑠𝑡 = $540 + $675 = $1215 11 Grade 10 Essential Math Personal Finance Learning Activity 2.4: Piecework and Contract 1. You are bundling fliers for a newspaper and are paid $0.35 for each bundle. If you are really good at your job and can bundle 22 fliers an hour: a. how much would you make in an 8 hour day? b. how much would you make in a 40 hour work week? 2. You are paid $0.10 per button to sew buttons on shirts. The boss deducts $0.05 for each flaw in your work. If you sewed 6500 buttons last week, but had 800 returned, find your gross earnings. 3. John is a contract painter. What will he charge his customer if the job required 6 cans of paint and took 4 hours to complete? John paid $12.99 for each can of paint, the rollers and trim tools cost another $35.95 and he pays himself an hourly rate of $14.35. 12 Grade 10 Essential Math Personal Finance Curriculum Outcomes: 10E1.P.1. Demonstrate an understanding of calculations for gross pay and net pay earned through income sources including: wages, salary, contracts, commissions, piecework Lesson 2 Assignment: Alternative Ways to Earn an Income SEE YOUR TEACHER FOR LESSON 2 ASSIGNMENT 13 Grade 10 Essential Math Personal Finance LESSON 3: TIME CARDS AND LATE PENALTIES Lesson Focus In this lesson, you will: learn to analyze and interpret time cards Lesson Introduction Most businesses that employ many workers will have you “punch in” a card into a time clock, which records the exact time you started your shift, and then “punch out” your card at the end of your shift. Other businesses require that employees wear a name tag, which has a bar code on it. The tag is scanned when you start and when you finish your shift. This lesson deals with reading time cards with the intent of establishing hours worked and determining gross pay. Hours at Work It is important that you understand that one-hour is 60 minutes long. So 15 minutes out of those 60 minutes would constitute a quarter of an hour, which is 0.25 hours. 30 mins is 0.5 hours and 45 mins is 0.75 hours. Time Cards Example: Calculate the gross pay for the employee in the time card below. Employee. Jim Dandy Hourly Rate: $9.35 Morning Day In Out Mon Afternoon In Out 1:00 5:00 1:00 4:30 Evening In Out 5:15 9:30 Hours Tues Wed Thurs Fri Sat 9:45 12:00 1:30 4:45 Sun Hours Rate Amount Regular Overtime Total Hours Gross Pay 14 Grade 10 Essential Math Personal Finance Solution: Employee. Jim Dandy Hourly Rate: $9.35 Morning Day In Out Mon Afternoon Evening In Hours In Out Out 1:00 5:00 4 1:00 4:30 3.5 Tues Wed Thurs 5:15 9:30 4.25 Fri Sat 9:45 12:00 1:30 4:45 5.5 Sun Hours Regular Overtime Total Hours 17.25 Rate Amount $9.35 $9.35 x 17.25= $161.29 0 17.25 Gross Pay $161.29 15 Grade 10 Essential Math Personal Finance Example: Susan works for a retail store in the mall. The company pays overtime hours over 40 per week at time and one-half. Add up Susan’s regular hours, determine the number of overtime hours, and then calculate her gross pay. Assume that her regular workday is from 8:00 – 12:00 am, she gets a one hour lunch break then her afternoon hours are 1:00 to 5:00. Any hours worked over 8 in a day are overtime hours as well as any hours she works on weekends and are paid at time and a half. Employee. Susan Que Hourly Rate: $10.28 Morning Afternoon Day In Out In Out Mon 8:00 12:01 1:00 5:05 Tues 7:58 12:00 1:03 5:03 Wed 7:00 12:05 1:00 Thurs 8:04 12:02 Fri 8:00 12:02 Sat Evening In Out 5:30 7:00 9:30 12:57 5:04 6:45 9:30 12:57 5:04 1:00 5:00 Hours Sun Hours Rate Amount Regular Overtime Total Hours Gross Pay 16 Grade 10 Essential Math Personal Finance Solution: Employee. Susan Que Hourly Rate: $10.28 Morning Afternoon Evening Day In Out In Out Mon 8:00 12:01 1:00 5:05 8 Tues 7:58 12:00 1:03 5:03 8 Wed 7:00 12:05 1:00 5:30 7:00 9:30 12 Thurs 8:04 12:02 12:57 5:04 6:45 9:30 10.75 Fri 8:00 12:02 12:57 5:04 8 1:00 5:00 4 Sat In Hours Out Sun Hours Regular Rate 40 Amount $10.28 Overtime 10.75 $10.28 x 1.5= $15.42 Total Hours 50.75 Gross Pay $10.28 x 40 = $411.20 $15.42 x 10.75= $165.77 $411.20+$165.77= $576.97 17 Grade 10 Essential Math Personal Finance Learning Activity 2.5: Time Cards 1. Harry works in a hospital. He is paid overtime at time and one-half for any hours worked over 8 each day from Monday to Friday, and paid double time for any work on Sunday. Use the following time card to calculate Harry’s gross pay. Employee. H. Smith Hourly Rate: $17.30 Morning Afternoon Day In Out In Out Mon 5:00 10:15 1:15 5:30 Tues 7:30 12:00 1:00 5:30 Wed 7:29 12:01 1:02 5:35 7:00 12:00 6:30 12:15 Evening In Out 7:30 11:15 Hours Thurs Fri Sat Sun Hours Rate Amount Regular Overtime x 1.5 Overtime x 2 Total Hours Gross Pay 18 Grade 10 Essential Math Personal Finance 2. Complete Janice’s time card and calculate her gross earnings. She earns $12.56 per hour, overtime is paid at time and one-half on any hours worked over 40 per week. Employee. Susan Que Hourly Rate: $12.56 Morning Afternoon Day In Out In Out Mon 7:45 12:00 1:00 5:15 Tues 8:01 12:03 12:57 5:01 Wed 8:00 12:00 1:01 Thurs 7:58 11:59 Fri 8:00 12:00 Evening In Out 5:27 7:00 9:45 1:01 5:00 7:00 9:15 1:01 5:15 Hours Sat Sun Hours Rate Amount Regular Overtime Total Hours Gross Pay 19 Grade 10 Essential Math Personal Finance Late Penalties: Some companies penalize workers for being late or leaving early. The penalty is deducted off the worker’s pay for each quarter hour, or part thereof, the worker starts late or leaves early. This means that some companies give a penalty of one-quarter hour (15 minutes) for employees being late or leaving early. So, even if you show up only 2 minutes late, the employee will deduct 15 minutes from your hours worked. Or, if you leave 5 minutes early at the end of the day, the employer deducts 15 minutes from your hours worked. Example: Find the penalties given to an employee if she shows up at 8:07 in the morning and leaves at 4:58 in the afternoon. What is the total number of hours this employee will be penalized? Solution: 𝑇ℎ𝑒 𝑒𝑚𝑝𝑙𝑜𝑦𝑒𝑒 𝑠ℎ𝑜𝑢𝑙𝑑 𝑏𝑒 𝑎𝑡 𝑤𝑜𝑟𝑘 𝑎𝑡 8: 00 𝑠𝑜 𝑡ℎ𝑒𝑦 𝑎𝑟𝑒 7 𝑚𝑖𝑛𝑢𝑡𝑒𝑠 𝑙𝑎𝑡𝑒 𝑇ℎ𝑒 𝑝𝑒𝑛𝑎𝑙𝑡𝑦 𝑖𝑠 15 𝑚𝑖𝑛𝑢𝑡𝑒𝑠 = 0.25 ℎ𝑜𝑢𝑟𝑠 𝑇ℎ𝑒 𝑒𝑚𝑝𝑙𝑜𝑦𝑒𝑒 𝑠ℎ𝑜𝑢𝑙𝑑 𝑏𝑒 𝑎𝑡 𝑤𝑜𝑟𝑘 𝑢𝑛𝑡𝑖𝑙 5: 00 𝑡ℎ𝑒𝑦 𝑙𝑒𝑓𝑡 2 𝑚𝑖𝑛𝑢𝑡𝑒𝑠 𝑒𝑎𝑟𝑙𝑦 𝑇ℎ𝑒 𝑝𝑒𝑛𝑎𝑙𝑡𝑦 𝑖𝑠 15 𝑚𝑖𝑛𝑢𝑡𝑒𝑠 = 0.25 ℎ𝑜𝑢𝑟𝑠 𝑇𝑜𝑡𝑎𝑙 𝑝𝑒𝑛𝑎𝑙𝑡𝑦 = 0.25 + 0.25 = 0.5 ℎ𝑜𝑢𝑟𝑠 Example: Find the penalties given to an employee if the following hours are on her time card: 8:17, 12:01, 1:05, and 4:55. Solution: 𝑇ℎ𝑒 𝑒𝑚𝑝𝑙𝑜𝑦𝑒𝑒 𝑠ℎ𝑜𝑢𝑙𝑑 𝑏𝑒 𝑎𝑡 𝑤𝑜𝑟𝑘 𝑎𝑡 8: 00 𝑠𝑜 𝑡ℎ𝑒𝑦 𝑎𝑟𝑒 17 𝑚𝑖𝑛𝑢𝑡𝑒𝑠 𝑙𝑎𝑡𝑒 𝑇ℎ𝑒 𝑝𝑒𝑛𝑎𝑙𝑡𝑦 𝑖𝑠 30 𝑚𝑖𝑛𝑢𝑡𝑒𝑠 = 0.5 ℎ𝑜𝑢𝑟𝑠 𝑇ℎ𝑒 𝑒𝑚𝑝𝑙𝑜𝑦𝑒𝑒 𝑠ℎ𝑜𝑢𝑙𝑑 𝑏𝑒 𝑎𝑡 𝑤𝑜𝑟𝑘 𝑎𝑡 1: 00 𝑠𝑜 𝑡ℎ𝑒𝑦 𝑎𝑟𝑒 5 𝑚𝑖𝑛𝑢𝑡𝑒𝑠 𝑙𝑎𝑡𝑒 𝑇ℎ𝑒 𝑝𝑒𝑛𝑎𝑙𝑡𝑦 𝑖𝑠 15 𝑚𝑖𝑛𝑢𝑡𝑒𝑠 = 0.25 ℎ𝑜𝑢𝑟𝑠 𝑇ℎ𝑒 𝑒𝑚𝑝𝑙𝑜𝑦𝑒𝑒 𝑠ℎ𝑜𝑢𝑙𝑑 𝑏𝑒 𝑎𝑡 𝑤𝑜𝑟𝑘 𝑢𝑛𝑡𝑖𝑙 5: 00 𝑡ℎ𝑒𝑦 𝑙𝑒𝑓𝑡 5 𝑚𝑖𝑛𝑢𝑡𝑒𝑠 𝑒𝑎𝑟𝑙𝑦 𝑇ℎ𝑒 𝑝𝑒𝑛𝑎𝑙𝑡𝑦 𝑖𝑠 15 𝑚𝑖𝑛𝑢𝑡𝑒𝑠 = 0.25 ℎ𝑜𝑢𝑟𝑠 𝑇𝑜𝑡𝑎𝑙 𝑝𝑒𝑛𝑎𝑙𝑡𝑦 = 0.5 + 0.25 + 0.25 = 1 ℎ𝑜𝑢𝑟 20 Grade 10 Essential Math Personal Finance Example: C.D. Romm is the assistant manager of a computer store. His hours are from 8:00 to 12:00 in the morning and from 1:00 to 5:00 in the afternoon, Monday to Friday. Any hours worked beyond this time are paid at time and a half. He is docked a quarter of an hour for every quarter of an hour or part thereof that he arrives late or leaves early. Complete the time card below and find C.D.’s gross weekly wages. Name: Morning Afternoon Day In Out In Out Mon 8:15 11:36 12:58 5:05 Tues 7:55 12:02 1:00 4:49 Wed 8:16 12:01 12:56 4:48 Thurs 8:07 11:45 1:00 Fri 7:56 12:00 1:02 Overtime In Out 5:03 6:15 8:45 4:06 6:00 9:30 9:30 12:00 Sat Hours REG. OT Su Hours Regular Rate Amount $14.85 Overtime Total Hours Total Earnings Learning Activity: 2.6 Late Penalties 1. An employee logged in at 7:58, and left at 11:59. Does he lose pay? 2. A worker logged in at 8:02, and left at 11:57. What pay does he lose? 3. Sylvia is employed in a hospital, and earns $27.78 per hours. She is paid double time for any hours worked on Sunday, and time and one-half for any hours over 40 per week. Use the time card to find her gross pay for the week. Her employer uses the 15 minute rule, her hours are from 7:00 – 11:00 in the morning and 12:00 – 4:00 in the afternoon. 21 Grade 10 Essential Math Personal Finance Employee. Sylvia Hourly Rate: $27.78 Morning Afternoon Day In Out In Out Mon 7:00 11:15 12:15 6:00 Tues 7:01 11:00 12:07 4:00 Wed 7:15 11:01 12:02 5:00 Thurs 7:00 11:00 12:00 5:15 Fri 7:03 11:00 12:00 3:58 6:00 12:00 Evening In Hours Out Sat Sun Hours Rate Amount Regular Overtime x 1.5 Overtime x 2 Total Hours Gross Pay 22 Grade 10 Essential Math Personal Finance Curriculum Outcomes P.4 calculate penalties for lateness Lesson 3 Assignment: Time Cards and Penalties SEE YOUR TEACHER FOR LESSON 3 ASSIGNMENT 23 Grade 10 Essential Math Personal Finance LESSON 4: ADDITIONAL EARNINGS AND BONUSES A bonus is an extra amount earned for a job well done or for exceeding expectations, and is paid in addition to regular pay and/or overtime pay. It may be a lump sum or a percentage of earnings. Danger pay, isolation pay, a shift premium, and tips are also paid in addition to regular pay. Examples: Deb works in a restaurant on evenings and weekends. She is paid $10 per hour, plus 90% of all tips received. If she worked 18 hours this week, and received $280 in tips, find her gross pay. Solution: 𝑃𝑎𝑦 𝑓𝑜𝑟 𝑟𝑒𝑔𝑢𝑙𝑎𝑟 ℎ𝑜𝑢𝑟𝑠 = $10 𝑥 18 = $180 𝐸𝑎𝑟𝑛𝑖𝑛𝑔𝑠 𝑓𝑟𝑜𝑚 𝑡𝑖𝑝𝑠 = $280 𝑥 0.90 = $252 𝐺𝑟𝑜𝑠𝑠 𝑃𝑎𝑦 = $180 + $252 = $432 Example: Marika works during the summer as a supervisor of a children’s program at the local community centre. She has a good reputation with the children and her employer wants her to come back next year. Marika earned $3600 during the summer and her employer offers her a 15% signing bonus if she will sign up for next year. If Marika signs up, how much will she get as a signing bonus? What is her new salary for the summer job? 𝑅𝑒𝑔𝑢𝑙𝑎𝑟 𝑃𝑎𝑦 = $3600 𝐵𝑜𝑛𝑢𝑠 = $3600 𝑥 0.15 = $540 𝐺𝑟𝑜𝑠𝑠 𝑃𝑎𝑦 = $3600 + $540 = $4140 Example: Suzette works as a waitress in a local café in Selkirk, MB. Today she had sales of $450.35 and gets 15% for her tips. What did she earn in tips today? 𝑇𝑖𝑝𝑠 = $450.35 𝑥 0.15 = $67.55 24 Grade 10 Essential Math Personal Finance Curriculum Outcomes: 10E1.P.1. Demonstrate an understanding of calculations for gross pay and net pay earned through income sources including: wages, salary, contracts, commissions, piecework Lesson 4 Assignment: Additional Earnings SEE YOUR TEACHER FOR LESSON 4 ASSIGNMENT 25 Grade 10 Essential Math Personal Finance LESSON 5: CHANGES IN INCOME Formulas: 𝑎𝑚𝑜𝑢𝑛𝑡 𝑜𝑓 𝑟𝑎𝑖𝑠𝑒 = (𝑜𝑙𝑑 𝑤𝑎𝑔𝑒)(𝑝𝑒𝑟𝑐𝑒𝑛𝑡 𝑜𝑓 𝑟𝑎𝑖𝑠𝑒) 𝑛𝑒𝑤 𝑤𝑎𝑔𝑒 = 𝑜𝑙𝑑 𝑤𝑎𝑔𝑒 + 𝑎𝑚𝑜𝑢𝑛𝑡 𝑜𝑓 𝑟𝑎𝑖𝑠𝑒 % 𝑟𝑎𝑖𝑠𝑒 = 𝑎𝑚𝑜𝑢𝑛𝑡 𝑜𝑓 𝑟𝑎𝑖𝑠𝑒 ∗ 100% 𝑜𝑙𝑑 𝑤𝑎𝑔𝑒 Example: A mechanic was earning $630 a week. Last week he got a 10% raise. How much more is he making a week? What is his new weekly salary? Solution: 𝑎𝑚𝑜𝑢𝑛𝑡 𝑜𝑓 𝑟𝑎𝑖𝑠𝑒 = ($630)(0.10) = $63 𝑛𝑒𝑤 𝑤𝑎𝑔𝑒 = $630 + $63 = $693 Example: A waiter was earning $5.75 an hour. The boss gave the waiter a raise of $1.00. Find the percent rate of increase. Solution: 𝑎𝑚𝑜𝑢𝑛𝑡 𝑜𝑓 𝑟𝑎𝑖𝑠𝑒 = $1.00 % 𝑟𝑎𝑖𝑠𝑒 = $1.00 ∗ 100% = 17.4% $5.75 Example: The employees of Company X are given two options for an increase in wages. They can either earn $1.00 more per hour or have their hourly rate of pay increased by 15%. Employee A earns $7.50 an hour which option should the employee choose in order to maximize the hourly rate of pay? Solution: 𝑎𝑚𝑜𝑢𝑛𝑡 𝑜𝑓 𝑟𝑎𝑖𝑠𝑒 = $1.00 𝑛𝑒𝑤 𝑤𝑎𝑔𝑒 = $7.50 + $1.00 = $8.50 OR 𝑎𝑚𝑜𝑢𝑛𝑡 𝑜𝑓 𝑟𝑎𝑖𝑠𝑒 = ($7.50)(0.15) = $1.13 𝑛𝑒𝑤 𝑤𝑎𝑔𝑒 = $7.50 + $1.13 = $8.63 Example: Last year a secretary was paid $32 000. Due to good work and improved qualifications, they receive a raise and now earn $34 560. What was the percent raise they received? Solution: 𝑎𝑚𝑜𝑢𝑛𝑡 𝑜𝑓 𝑟𝑎𝑖𝑠𝑒 = $34 560 − $32 000 = $2560 $2560 % 𝑟𝑎𝑖𝑠𝑒 = ∗ 100% = 8% $32 000 26 Grade 10 Essential Math Personal Finance Curriculum Outcomes: 10E1.P.1. Demonstrate an understanding of calculations for gross pay and net pay earned through income sources including: wages, salary, contracts, commissions, piecework Lesson 5 Assignment: Changes in Income SEE YOUR TEACHER FOR LESSON 5 ASSIGNMENT 27 Grade 10 Essential Math Personal Finance LESSON 6: DEDUCTIONS AND NET PAY Lesson Introduction: When you work at a job you have to pay certain deductions. The amount you earn before deductions is called Gross Income and the amount you earn after deductions is called Net Income. Net Income – is your “take home pay”; it is the amount left after deductions Deductions: are the amounts that are taken off of your gross pay; there are three basic types of deductions: 1. Employer deductions: insurance (life, dental, medical), union dues 2. Voluntary deductions: charitable donations, RRSP 3. Mandatory deductions: a. EI – employment insurance, b. CPP – Canadian pension plan Note: EI, CPP, and income tax are based on income as well as age, number of dependents, charitable donations etc which are taken into consideration by the different claim codes. ***NOTE: Provincial and Federal tax are found using Taxable Income 𝑻𝒂𝒙𝒂𝒃𝒍𝒆 𝑰𝒏𝒄𝒐𝒎𝒆 = 𝑮𝒓𝒐𝒔𝒔 𝑰𝒏𝒄𝒐𝒎𝒆 − 𝑼𝒏𝒊𝒐𝒏 𝑫𝒖𝒆𝒔 − 𝑹𝑹𝑺𝑷 c. Provincial Income Tax – each province in Canada sets its own tax rates; depending on your level of income, you will fall into one of three tax brackets; is found using Taxable Income d. Federal Income Tax – the federal government of Canada sets its own tax rate; similar to provincial rates the amount you are taxed depends on your level of income, is found using Taxable Income Formula: 𝑁𝑒𝑡 𝐼𝑛𝑐𝑜𝑚𝑒 = 𝐺𝑟𝑜𝑠𝑠 𝐼𝑛𝑐𝑜𝑚𝑒 − 𝐷𝑒𝑑𝑢𝑐𝑡𝑖𝑜𝑛𝑠 28 Grade 10 Essential Math Personal Finance Example: Gary works at a bus manufacturing company. He is paid $17.30 an hour. His work week is 40 hours and he has the following deductions: EI = $10.55, CPP = $26.85, Prov Tax = $62 and Fed Tax = $82.45, what is his net income for the week? Solution: 𝐺𝑟𝑜𝑠𝑠 𝐼𝑛𝑐𝑜𝑚𝑒 = ($17.30)(40) = $692 𝑇𝑜𝑡𝑎𝑙 𝐷𝑒𝑑𝑢𝑐𝑡𝑖𝑜𝑛𝑠 = $10.55 + $26.85 + $62 + $82.45 = $181.85 𝑁𝑒𝑡 𝐼𝑛𝑐𝑜𝑚𝑒 = $692 − $181.85 = $510.15 Example: Laurel is paid a monthly salary of $2950. The firm charges her a $5.25 per week for parking. She also has weekly CPP deductions of $30.37, EI of $11.78, federal tax of $92.55, and provincial tax of $70.65. What is her net income for the week? Solution: 𝐺𝑟𝑜𝑠𝑠 𝑃𝑎𝑦 𝑓𝑜𝑟 𝑡ℎ𝑒 𝑴𝒐𝒏𝒕𝒉 = $2950 Since all the deductions are each week we need to know her weekly gross pay: 𝐴𝑛𝑛𝑢𝑎𝑙 𝑔𝑟𝑜𝑠𝑠 𝑝𝑎𝑦 = ($2950)(12) = $35400 𝑊𝑒𝑒𝑘𝑙𝑦 𝑔𝑟𝑜𝑠𝑠 𝑝𝑎𝑦 = $35400 = $680.77 52 𝑇𝑜𝑡𝑎𝑙 𝐷𝑒𝑑𝑢𝑐𝑡𝑖𝑜𝑛𝑠 = $5.25 + $30.37 + $11.78 + $92.55 + $70.65 = $210.60 𝑤𝑒𝑒𝑘𝑙𝑦 𝑁𝑒𝑡 𝐼𝑛𝑐𝑜𝑚𝑒 = $680.77 − $210.60 = $470.17 Example: Sam works for a seed company that pays him $11.88 per hour. He worked 32 hours last week. His deductions include CPP of $15.49, EI $6.58, Federal tax $50.80 and provincial tax $38.55. What is his net pay for the week? Solution: 𝐺𝑟𝑜𝑠𝑠 𝑃𝑎𝑦 = ($11.88)(32) = $380.16 𝑇𝑜𝑡𝑎𝑙 𝐷𝑒𝑑𝑢𝑐𝑡𝑖𝑜𝑛𝑠 = $15.49 + $6.58 + $50.80 + $38.55 = $111.42 𝑁𝑒𝑡 𝐼𝑛𝑐𝑜𝑚𝑒 = $380.16 − $111.42 = $268.74 29 Grade 10 Essential Math Personal Finance Curriculum Outcomes: 10E1.P.1. Demonstrate an understanding of calculations for gross pay and net pay earned through income sources including: wages, salary, contracts, commissions, piecework Lesson 6 Assignment: Net Income SEE YOUR TEACHER FOR LESSON 6 ASSIGNMENT 30