In Incomplete records, examination question often includes manager’s commission.
The commission may be expressed as a percentage of profits AFTER such commission had been deducted.
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Illustration: The net profits of a business are $500,000 and the manager is entitled to 10% of the net profits AFTER such commission has been deducted. Question: Compute his commission? |
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Solution:
Percentage Commission x Profits before Commission 100 +% Commission
=10/110 x $500,000
= $45,454.50
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