Earn Income - Complete
Earn Income - Complete
Earn Income - Complete
2 Gross Pay
4 Time Cards
Quiz 1
5 Overtime Pay
7 Additional Earnings
Quiz 2
9 Deductions Tables
10 Pay Statements
11 More
1
Self Assessment
On the following chart, indicate how confident you feel about each statement.
1 – I need more help 2 – I need more practice 3 – I could teach it !
Discuss this with your teacher before you write the test!
Statement
1, 2 or 3
After completing this chapter;
I can calculate gross pay if I know a rate of pay and amount of time
worked
I can calculate the total time worked from a weekly work schedule
I can describe different methods for earning an income (a salary,
piecework, a salary plus commission, etc.), and give examples of jobs
that fall into different categories
I can calculate earnings from the combination of a salary plus
commission, bonuses, or tips
I can calculate gross pay based on piecework
I can describe the advantages and disadvantages of a given method of
earning an income (contract work, piecework, salary, or commission,
etc.)
I can determine CPP, EI, and income tax deductions (federal and
provincial/territorial) for a given gross pay, both from tax tables and by
calculation, and can use these to calculate net pay
Vocabulary:
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WAYS OF EARNING AN INCOME
People who work earn their income in different ways. Their income is the money they
receive for the work they do. The way they are paid depends on the type of job they have.
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GROSS PAY
Whether you are paid a salary, a wage, or any other manner, your income is the amount of
money you receive for the work you do. This income can be paid weekly, biweekly (every
two weeks), semi-monthly (twice a month) or monthly. The amount of money you make
before any deductions is called your gross pay. Deductions – money taken off your
paycheque to pay taxes, union dues, and other benefits – will be discussed later in this unit.
It is important to know how to calculate gross pay for different types of jobs.
Example 1: Maria works as an electrician and earns $24.68/h. If she worked for 15 hours on
one job, how much did she earn?
Solution: Multiply the hourly wage by the number of hours she worked.
Example 2: Last year, Michelle earned $45 183.36 at a hair salon. What was her average
monthly income?
2) Ben works in a trucking business and is paid $35.75/h. Last week he worked the
following hours:
Monday – 6 hours What was his gross pay for this week?
Tuesday – 8 hours
Wednesday – 8 hours
Thursday – 12 hours
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3) Jimmy is a flag person and earned $321.10 last week for 32.5 hours work. What is his
hourly wage?
4) Martha’s annual salary last year was $72 000. What was her gross pay each month?
Everyone knows that an hour has 60 minutes. Therefore, parts of hours are based on the
whole being 60 minutes as follows:
11:30
- 8:30
3:00 Mike worked 3 hours.
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ASSIGNMENT 3 – KEEPING TRACK OF TIME
1) Calculate the hours worked for the following shifts. Show your work. You will have to
use the 24h technique (above) to show your work for d, e and f.
a) 9:00 to 12:00 b) 1:15 to 3:30
TIME CARDS
Often employers keep time records for employees using time cards. The employee will
enter the times they worked and submit the time card on a regular basis in order to be paid.
Example: Antonio’s time card for the last week is below.
a) How many hours did he work in this week?
Solution: Calculate the hours for each day worked and add them together. Use the
subtraction method described on p10 & 11 or………….
Count the hours using your fingers and turn the ‘part hours’ into decimals.
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1) Monty works part time at a gas station. He earns $9.45/h. His time card for one week is
shown below.
2) Hannah works as a part-time warehouse technician. She often works a split-shift, where
her work day is split between two time blocks. She gets paid $12.76/h. Her time card is
shown below.
a) How many hours did Hannah work in this week? Show your work.
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You are ready for Quiz 1
OVERTIME PAY
Many full-time jobs have a 40-hour work week, but other jobs may have different regular
hours. Either way, if you work more than the regular number of hours required, it is
classified as overtime and you will earn overtime pay for those extra hours.
Overtime is often paid at “time and a half” – that means you get 1.5 times your regular
wage. Overtime could also be “double time” which means you get 2 times your regular
wage. Overtime wages must be agreed upon by the employer and employee before any
extra money is paid.
Example: Marcel earns $15.82/h and he works 37.5 hours each week. He is paid time and a
half for any extra hours he works over 37.5 hours each week. If he works 42.25 hours
during one week, how much will he earn?
Solution:
First calculate Marcel’s regular wages for 37.5 hours.
37.5 hours × $15.82 = $593.25
Now calculate Marcel’s overtime wages. He is paid 1.5 times his regular wage.
Regular hourly rate × 1.5 (overtime) × overtime hours = overtime wages
$15.82 × 1.5 × 4.75 hours = $112.72
Finally, add Marcel’s regular wages and his overtime wages together.
$593.25 + $112.72 = $705.97
ASSIGNMENT 5 – OVERTIME PAY
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1) Ingrid works as a medical receptionist at a rate of $11.82/h for 35 hours per week. She is
paid overtime at time and a half for extra hours she works each week. Last week, she
worked 42 hours. What will her weekly pay be for last week?
2) Natalie works as a playground supervisor for 8 weeks during the summer at a rate of
$15.27/h. She works a 40-hour week and averages 3 hours of overtime each week, paid
at time and a half. How much will she earn each week, and for the whole summer?
Example 1: Piecework
Greg works as a tree planter during the summer and earns $2.50 for each tree he plants. If
he planted 45 trees one day, how much did he earn?
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1) Thomasina knits sweaters and sells them at a craft shop. She charges $75.50 for a large
sweater. If she sells 5 large sweaters, how much will she earn?
2) Jack cleans windows for extra income. He charges $3.00 for a main floor window and
$5.00 for a second-story window. How much will he earn if he cleans a house with 7 main
floor windows and 6 second-story windows?
3) Karissa picked 18 quarts of strawberries and earned $67.50. How much did she earn per
quart?
4) Joey is a writer who often writes articles for a local newspaper. He is paid $0.35 per word
for his articles. How many words were in Joey’s last article if he was paid $192.50?
5) Sara works in a sports store and earns 12% commission on her sales. How much does
she make on a bicycle that sold for $785.95?
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6) A real estate agent makes 5% commission on the first $250 000 of the house’s selling
price and 2% on any amount over that. What is Sue’s commission when she sells a
house worth $375 000?
ADDITIONAL EARNINGS
In some jobs, an extra amount is earned for a job well done or for exceeding expectations.
This bonus payment is paid in addition to regular pay and/or overtime, and could be a lump
sum payment or a percentage of earnings. Other additional earnings include danger pay,
isolation pay, a shift premium, and tips.
Example 1: Last summer, Jordan earned $3600 in his job. He has been promised a signing
bonus of 15% if he agrees to sign up to work for his company again. If Jordan
signs up, how much will he get as a signing bonus?
2) Raymond receives a bonus for isolation pay. His regular pay is $2245/month. He is
offered either a bonus of 12% or $275. Which will give him a higher gross pay?
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3) A courier driver is offered a shift premium of $7.00/h to drive after 8:00 pm. Mike’s
schedule last week is show below:
If Mike’s regular pay is $12.75/h, how much did he earn last week?
4) Chen is working for 10 weeks in Northern Canada. He is paid $532/week and he gets an
isolation bonus. The bonus offered is 28% of his total earnings for the 10 weeks, or
$1250. Which is the better option for Chen to choose?
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5) Kirsten works as a waitress. She earns a base wage of $8.20/h, plus tips. One day she
bills her customers $950, and her tips are 15%. What is Kirsten’s income, with tips, for
this 8-hour day?
Income taxes are only paid on your taxable income, which is the income after certain
deductions are made.
Example 1: John’s life insurance is 1.5% of his salary of $450. How much does he pay for
his life insurance?
0.015 × $450 = $6.75 John pays $6.75 for his life insurance per paycheque.
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ASSIGNMENT 8 – NET PAY AND DEDUCTIONS
1) If the federal tax rate is 15%, how much is deducted from your $750 paycheque for
federal taxes?
2) Marc has a gross income of $500 per week. He pays $1.38 in union dues and contributes
$43.00 towards his company pension plan each week. What is his weekly taxable
income?
3) Samara’s taxable income was $3276.54 last month. If she paid $757.24 in taxes, what
percentage of her taxable income did she pay?
4) Hans paid $37.51 Employment Insurance (EI) on his monthly income of $2168.21. What
was the EI rate?
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DEDUCTION TABLES
Another way to determine deductions for federal tax, provincial/territorial tax, EI, or CPP is
to use a deduction table. These are published by the Government of Canada each year for
federal rates and for each province/territory.
To use a deduction table, find the taxable income in the left column and read the deduction
from the appropriate column on the right side. Tax tables have different claim codes so read
them carefully.
Example: A hotel clerk in Whistler, BC earns $2430 each month. His Claim Code is 2. How
much federal and provincial taxes will be deducted from his pay? Use the portions of the
deduction tables below to answer the question.
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PAY STATEMENTS
A pay statement is a form that an employer gives each employee that shows gross
earnings and deductions from earnings for a pay period. Pay statements can also be used
to serve as a record for deduction calculations, and for determining net pay.
Example 1: Examine the simplified pay statement below and answer the following
questions.
c) If Jolie’s gross earnings are $712.50, how many hours did she work?
Solution: Divide $712.50 by $19.00
$712.59 ÷ $19.00 = 37.5 hours
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ASSIGNMENT 10 – PAY STATEMENTS
1) Using the pay statement below for Amanda, answer the following questions.
d) What percent of her gross pay did she pay in federal taxes?
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2) Kathy has a biweekly gross income of $3654.75. Calculate Kathy’s net pay (also
called take-home pay). Using the pay statement below, enter the correct numbers in
the correct boxes. SHOW ALL YOUR CALCULATIONS in the white spaces on
this page.
Her deductions include union dues of 3.1% of her gross earnings, and a
company pension amount of 4% of her gross earnings.
She pays federal tax at a rate of 18.5% and provincial tax at a rate of 6.2%
of her taxable income.
She pays $160.07 for CPP and $74.70 for EI.
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ASSIGNMENT 11: MORE
1. Gary has a part-time job at Raven Recycling. He earns $13.50/hr and overtime pay for
shifts that exceed 8h. All scheduled breaks (including meal breaks) are included in his
hours worked.
a) Complete the table to calculate Gary’s daily earnings.
2. Leanne sells the beaded leather moccasins that her mother makes. The moccasins
sell for $250 a pair and Leanne earns 25% commission on her sales.
b) Leanne earned $1500 last month. How many pairs of moccasins did she sell?
3. Andrea works as a hairstylist. She charges $60 per haircut. She pays the salon
owner 20% of her earnings from each haircut.
a) How much does Andrea pay the salon owner per haircut?
b) Andrea, the hairstylist, has eight customers in one day. How much will Andrea
have to pay the salon owner?
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