Questions: Multiple Choice Question Lambert had net sales of 72,000 and earns 3% on the first 40,000 of net sales, 4.5% on the next 20,000 and 5% on anything over 60,000. What are Lambert's commission earnings? 3,600 2,700 3,240

Solution Steps

To solve this problem, we need to calculate Lambert's commission earnings based on the given percentage rates for different ranges of net sales. We will break down the net sales into three parts: the first $40,000, the next $20,000, and anything over $60,000. We will then apply the respective commission rates to each part and sum them up to get the total commission earnings.

For the first $40,000 of net sales, Lambert earns a commission of \(3\%\). Thus, the commission for this portion is calculated as: \[ \text{First Part Commission} = 40000 \times 0.03 = 1200 \]

For the next $20,000 (from $40,001 to $60,000), Lambert earns a commission of \(4.5\%\). Therefore, the commission for this portion is: \[ \text{Second Part Commission} = 20000 \times 0.045 = 900 \]

For the amount over $60,000, which in this case is \(72000 - 60000 = 12000\), Lambert earns a commission of \(5\%\). The commission for this portion is: \[ \text{Third Part Commission} = 12000 \times 0.05 = 600 \]

Now, we sum all the commissions to find the total earnings: \[ \text{Total Commission} = 1200 + 900 + 600 = 2700 \]

Final Answer