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Gross Earnings: Wages & Salaries-Math with Business Applications, Payroll Unit - YouTube
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Several methods are used
to find an employee's pay.
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Salaries and wages are
discussed in this section.
[15]
In some businesses, the
first step in preparing
[18]
the payroll is to
look at a timecard.
[22]
This timecard is maintained
for each employee.
[26]
The timecard shows the
dates of the pay period,
[30]
the employee's name and
other personal information,
[33]
the days, times,
and hours worked,
[35]
and the total number
of hours worked.
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The information on
these cards is then
[42]
transferred to a payroll ledger,
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a chart showing all
payroll information.
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From there we can calculate
the gross earnings.
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Gross earnings are found by
taking the number of hours
[54]
worked times the rate per hour.
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So here we have an example of R.
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Petty worked to
total of 32.5 hours.
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We will multiply it by
the rate to give us
[68]
the gross earnings and
likewise for D. Dean,
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had a total of 35 hours multiply
it by the rate per hour.
[78]
So every hour worked,
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this individual receives $8.01
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for a gross earnings of $280.35.
[89]
The Fair Labor
Standards Act covers
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the majority of full time
employees in the United States.
[96]
It establishes a work week of
[99]
40 hours and sets a
minimum hourly wage.
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The law states that
an overtime wage,
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a higher than normal wage,
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must be paid for all hours worked
[112]
over 40 hours during a work week.
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Also, many companies now
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covered by the Fair
Labor Standards Act
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have voluntarily followed
[123]
the practice of paying
time-and-a-half,
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one and a half or 1.5
times the normal rate
[130]
for any work over
40 hours per week.
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Let's look at an example.
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The normal pay rate
is $9.18 per hour.
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Hours worked this
week is 47 hours.
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Overtime if applicable, is
paid at time-and-a-half.
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So of the 47 hours,
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40 would be the
regular work week,
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that's leaving us a difference is
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seven hours in the
category of overtime.
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The straight pay or
regular pay would be the
[168]
$9.18 times the 40
hours of regular hours.
[175]
That product results
in a regular pay,
[179]
overtime then is time-and-a-half.
[183]
So we take the normal regular
pay and multiply it by 1.5.
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So every hour of overtime,
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this worker would be
receiving $13.77 per hour.
[198]
Seven hours of overtime at
[201]
time-and-a-half results
in an additional $96.39,
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add the regular pay
and overtime together
[210]
will give us the gross pay
for this week of work.
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Here we have a
ledger showing hours
[225]
of work during the week.
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For R. Petty, if you add up
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the total hours worked
there's 44.5 hours,
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D. Dean has 43 hours,
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using the 40 hour standard
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work week established by the
Fair Labor Standards Act,
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and subtracting the 40
[250]
from the total number
of hours worked,
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R. Petty has 4.5
hours of overtime,
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and subtracting 40 from D. Dean,
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leaves three hours of overtime.
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We're given the rates.
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So for gross earnings
we'll take 40
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times 9.50 for R. Petty,
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for the time-and-a-half we'll
take the 9.50 times 1.5.
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That'll give us our
overtime wage times
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the number of hours of
overtime they worked,
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gives us an overtime
pay of 64.13,
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add regular or straight pay plus
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the overtime gives us
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the gross earnings
for this individual.
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Similar for D. Dean,
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40 hours at 8.85 hourly
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rate gives us $354
of straight pay,
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and then calculating
the overtime pay,
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we can do this in
all one calculation.
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Regular hourly rate times
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1.5 or time-and-a-half
overtime pay,
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times the number of hours of
overtime which was three,
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gives us just shy of $40,
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add regular and overtime gives us
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a gross pay for D. Dean.
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Some companies pay the
time-and-a-half rate
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for all time worked
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over eight hours
in any one day no
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matter how many hours
are worked in a week.
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This is known as daily overtime.
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Let's take a look at an example.
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On Monday, Kim works 13 hours.
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Her regular pay rate
is $12 per hour.
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What is her pay on Monday,
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if the company uses the overtime
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for over eight hours
of work per day.
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She worked 13 hours,
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so of that, eight hours
is at standard day.
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So eight hours at her
regular pay gives you
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$96 and because she
worked 13 hours,
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the difference between the
eight hour regular day
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and 13 leaves us with five hours
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of overtime that we will
multiply by our overtime rate.
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So she normally makes $12,
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we times that by 1.5,
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her time-and-a-half or
overtime rate is $18 per
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hour times the five hours
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beyond the eight hours in a day,
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she has an additional $90 earned.
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Her gross pay then would
be the sum of those two.
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This would be her gross
earnings for one day.
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In this example, it
[428]
asks us to determine
the workers pay if
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their regular pay rate
is 9.90 per hour.
[434]
So here we have
[436]
a ledger showing the
hours worked each day.
[440]
Monday is over eight hours
[442]
as well as Thursday
over eight hours.
[444]
The other remaining three
days are at regular pay.
[449]
So here we have a
chart broken down with
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the difference between the
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regular and the remaining time,
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which is considered
overtime and paid at
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the higher time-and-a-half rate
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for Monday as well as Thursday.
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So we can add the
regular hours of work
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together and calculate what
the regular pay would be.
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Thirty-six hours at
regular pay rate
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9.90 gives us a gross
pay of $356.40.
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Then we can go back
to the ledger,
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add up the number of
hours of overtime,
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which is five hours,
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and calculate the overtime pay.
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We need to find what that
overtime pay rate is.
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We'll take the straight
wages times time-and-a-half,
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in other words 1.5.
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Every hour of overtime
receives $14.85 rate,
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times the number
of overtime hours,
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five gives us the
overtime pay and for
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the gross earnings for
this worker for this week,
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we'll add those two together.
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The second common
method of finding
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gross earnings uses a salary.
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A salary is a fixed amount
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given as so much per pay period.
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It can be monthly,
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which means there would
be 12 paychecks per year.
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Another common pay period
would be semimonthly,
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since there's two pay
periods per month,
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that would mean 24 total
paychecks per year,
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biweekly is every two weeks.
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Given there's 52 weeks in a year,
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52 divided by 2 means
26 paychecks per year,
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or it could be weekly,
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52 paychecks per year.
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They're asking us to
determine equivalent salaries
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done based on the
frequency of the pay.
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So we're given in this chart,
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semimonthly as $1,580, that
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means twice a month
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this individual would
receive this amount.
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Twice a month and 12 months,
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we would multiply this amount by
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24 to give us our annual salary.
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Once we have the annual salary,
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we could divide that by
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12 to give us the
monthly or we could
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have doubled the semimonthly to
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come up with the
equivalent monthly salary.
[615]
Again, once we have annual,
[618]
we can determine the biweekly,
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which means every two weeks,
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52 divided by 2 is 26 paychecks.
[630]
So we'll divide our annual
salary by 26 to give
[633]
us the biweekly pay for
the salaried worker,
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and to determine weekly,
[639]
we can take our
annual and divide it
[642]
by 52 since there's
52 weeks in a year,
[645]
or we could have taken
our biweekly and
[649]
divided it by two to
come up with the weekly.
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