Every month Terri earns a 5% commission on the amount of her sales. If Terri's total commission was $1,600 during the month of August, what was the amount of her sales for the month?

Rationale

Terri's sales for the month were $32,000.

To calculate Terri's sales based on her commission, we can use the formula: Total Sales = Total Commission / Commission Rate. Here, her total commission of $1,600 divided by 5% (or 0.05) results in total sales of $32,000.

A ($15,230) YOUR ANSWER

This choice is incorrect because if Terri's sales were $15,230, her commission at 5% would be only about $761.50, which does not match the total commission of $1,600 earned in August.

B ($16,800) YOUR ANSWER

Choosing $16,800 for her total sales would yield a commission of $840 (5% of $16,800). This amount is still significantly less than the reported commission of $1,600, indicating that her sales must be higher.

C ($32,000) CORRECT

This is the correct answer because when we calculate 5% of $32,000, it equals $1,600, which matches the total commission Terri earned during the month of August.

D ($80,000) YOUR ANSWER

If Terri's sales were $80,000, her commission at 5% would amount to $4,000. This amount is too high compared to the actual commission of $1,600, confirming that $80,000 cannot be the correct sales figure.

Conclusion

Terri earned a commission of $1,600 from her sales, which translates to total sales of $32,000 at a commission rate of 5%. The other options presented inaccurately represent her sales based on the commission earned, demonstrating the importance of using the correct calculations to arrive at the accurate sales figure. This problem illustrates how commission structures can be utilized to determine overall sales performance effectively.

Every month Terri earns a 5% commission on the amount of her sales. If Terri's total commission was $1,600 during the month of August, what was the amount of her sales for the month?

Terri's sales for the month were $32,000.

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