An employee earning $22 per hour works 45 hours one week and 35 hours the next week. Calculate the total gross pay for both weeks combined.
Correct Answer
C) $1,815
Week 1: (40 × $22) + (5 × $33 overtime) = $880 + $165 = $1,045. Week 2: 35 × $22 = $770. Total: $1,045 + $770 = $1,815.
Why This Is the Correct Answer
Option C correctly applies overtime pay rules. Week 1: 40 regular hours at $22 = $880, plus 5 overtime hours at time-and-a-half ($33) = $165, totaling $1,045. Week 2: 35 regular hours at $22 = $770. Combined total: $1,045 + $770 = $1,815. This follows federal overtime requirements for hours worked over 40 in a single workweek.
Why the Other Options Are Wrong
Option A: $1,760
This answer ($1,760) fails to account for overtime pay in week 1. It appears to calculate both weeks at straight time: 80 total hours × $22 = $1,760, ignoring the requirement to pay time-and-a-half for the 5 hours over 40 in week 1.
Option B: 1,870
This answer ($1,870) incorrectly calculates overtime. It may result from applying overtime rate to all hours in week 1 rather than just the 5 hours over 40, or from miscalculating the overtime rate or regular pay amounts.
Option D: $1,925
This answer ($1,925) significantly overstates the pay. It likely results from major calculation errors, possibly applying overtime rates incorrectly to multiple hours or weeks, or adding incorrect amounts to the base calculations.
Memory Technique
Remember 'FORTY-FIFTY': Over 40 hours = 1.5x pay (Forty hours regular, Fifty percent more for overtime). Each week stands alone for overtime calculations.
More Business & Finance Questions
A general contractor purchases equipment worth $45,000 with a useful life of 9 years and no salvage value. Using straight-line depreciation, what is the annual depreciation expense?
What is the typical recommended coverage amount for general liability insurance for a small to medium-sized general contracting business?
A contractor estimates startup costs of $75,000 for equipment, $25,000 for initial inventory, $15,000 for insurance premiums, and $10,000 for working capital. They can finance 70% of the total. How much cash do they need?
When establishing professional relationships with architects and engineers, what is the most important factor for a general contractor to consider?
A partnership agreement for a construction company should address all of the following EXCEPT:
A contractor purchases a truck for $60,000. After 5 years, it has accumulated depreciation of $35,000. What is the truck's book value?
A contractor's business plan projects first-year revenue of $500,000 with a 15% net profit margin. If actual revenue is $450,000 with the same profit margin, what is the variance in net profit?
Using the Modified Accelerated Cost Recovery System (MACRS), construction equipment is typically depreciated over how many years?
A contractor is comparing financing options for equipment purchase. Option A: $80,000 cash purchase. Option B: $20,000 down, $65,000 financed at 6% for 4 years. What is the total cost of Option B?
A contractor purchases equipment using a capital lease with a present value of $120,000. How should this be recorded on the balance sheet?