Consumer

arithmetic
3
This chapter at a glance

Consumer arithmetic
Stage 5.1/5.2
After completing this chapter, you should be able to:

calculate earnings for employees in the form of salaries, wages, commission,
piece work and casual work

calculate overtime pay at special pay rates

calculate holiday leave loading and bonuses

calculate weekly, fortnightly, monthly and yearly incomes

calculate net pay after deductions such as taxation and superannuation

calculate the taxable income after allowable tax deductions have been considered

calculate the tax payable and net income on a given gross income

calculate the Medicare levy payable on a given taxable income

prepare a budget for a given income and solve budget problems

calculate a best buy

solve problems involving discounts

solve problems involving profit and loss.

67
68 Mathscape 9

3.1 Salaries and wages

Self-employed people charge a fee to those for whom they provide their services. However,
men and women who work for other people are paid in a variety of different ways. Most people
are paid by either wage or salary.

■ Salaries
A salary is a fixed amount paid for one year’s work. It is usually divided into equal weekly,
fortnightly or monthly payments. Employees who are paid a salary are also entitled to sick pay,
holiday pay and the required superannuation employer contributions. Salary earners are not
paid for extra hours worked; however, they may be able to negotiate some time off with their
employer. This may, for example, allow for a late start on one day or an early departure.
Typical salary earners include teachers, police, public servants and scientists.

■ Wages
A wage is a fixed amount paid for each hour’s work for a specified number of hours per week.
Employees who are paid a wage are also entitled to sick pay, holiday pay and the required
superannuation employer contributions. Wage earners are paid for extra hours worked, usually
at a higher hourly rate of pay.
Typical wage earners include sales assistants, construction workers, mechanics and factory
workers.

Example 1 Solutions
EG Alice is paid $620 per week. a Annual salary = weekly pay × 52
+S
Find her: = $620 × 52
a annual salary = $32 240
b fortnightly pay b Fortnightly pay = weekly pay × 2
c monthly pay = $620 × 2
= $1240
c Monthly pay = annual salary ÷ 12
= $32 240 ÷ 12
= $2686.67

Example 2 Solutions
EG a Virgil works 40 hours a Weekly wage = hourly rate of pay × number of hours
+S
per week as a mechanic worked
and earns $13.45 per = $13.45 × 40
hour. Calculate his = $538
regular weekly wage.
 Chapter 3: Co n su mer arit hmet ic 69

b Paul works 36 hours per b Hourly rate of pay = weekly wage ÷ number of hours
week as a glazier and worked
earns a regular weekly = $525.60 ÷ 36
wage of $525.60. Find = $14.60
his hourly rate of pay.

Example 3 Solution
EG John’s annual salary is i New annual salary = 1.06 × old salary
+S
$28 490. Find his fortnightly = 1.06 × $28 490
pay after receiving a 6% pay = $30 199.40
rise. ii Fortnightly pay = annual salary ÷ 26
= $30 199.40 ÷ 26
= $1161.52

Exercise 3.1

1 Carrie earns an annual salary of $28 080. How much would Carrie receive if she asked to
be paid:
a weekly? b fortnightly? c monthly?

2 Find the annual salary of a worker whose:

a weekly pay is $498 b fortnightly pay is $1362.50
c monthly pay is $4423.92

3 Calculate the weekly wage for a tradesperson who works:

a a 38-hour week at $12.20/h b a 33-hour week at $16.15/h

4 For how many hours must an employee work each week at the rate of:
a $16/h to earn $592? b $17.40/h to earn $635.10?

5 a Increase an annual salary of $31 400 by 5%.

b Increase a monthly salary of $2925 by 7.2%.

6 a Decrease an annual salary of $48 990 by 12%.

b Decrease a fortnightly salary of $2738 by 8.7%.

■ Consolidation
7 Gary the gardener works at a municipal golf course and is paid an annual salary of $29 640.
How much would Gary have been paid after 11 weeks?
8 Moira is paid $891.60 each fortnight as a hairdresser. How much would she have been paid
after working for 18 weeks?
70 Mathscape 9

9 Mitchell is considering applying for these two jobs which have been advertised in the
newspaper.
i Pharmacist’s assistant—Salary: $1040 per fortnight
ii Security guard—Wage: $14.67/h, 35 hours per week
Which position offers the better pay and by how much per week?
10 Sergeant Carlton is paid $1856.40 per month as a soldier in the Australian Army. What is
his equivalent weekly rate of pay?
11 A helicopter pilot is paid $506.75 per week. Calculate his equivalent monthly pay.

12 A sales position is advertised in a weekend newspaper with an annual salary of $32K. What
does this mean?

13 Denise earns $3740 per month as an executive producer at a television station. Find her
equivalent fortnightly pay.
14 Malek’s annual salary is $45 820. Calculate his new weekly pay if Malek receives a pay rise
of 5%.
15 By how much will Kevin’s weekly pay increase if his annual salary of $41 066 is increased
by 4%?
16 Leila earns $1072.90 per week as an architect. Find her new annual salary if she receives a
pay rise of 7 1--2- %.

17 The employees at a fruit company are required to take a pay cut of 10% to ensure that the
business does not go bankrupt. Calculate the new fortnightly pay of a fruit canner whose
annual salary was $25 400 before the pay cut.
18 Due to falling sales, the employees at a small shoe factory have their pay reduced by 8%.
Calculate the new annual pay for a worker who previously earned $385 per week.
19 Copy and complete the following wage table.
Employee Hours worked Hourly rate of pay Total weekly pay
Bart 34 $15.20
Kristina $10.95 $416.10
Marta 36 $532.80
Dylan 39 $18.30
Brian 27 $627.75
Kang $19.90 $796.00

20 Dean works from 8:30 am to 5 pm each day, Monday to Friday, as a shop assistant.
Calculate Dean’s fortnightly pay if he earns $12.75 per hour.
 Chapter 3: Co n su mer arit hmet ic 71

21 Rudy earns $15.65/h for a 37-hour week, while George is paid an annual salary of $33 189.
By how much must Rudy’s hourly rate of pay be increased in order to earn the same annual
pay as George?
22 Anise has a casual job selling whitegoods. She is paid $10.40 per hour during the week and
$15.60 per hour on weekends. Find her pay for a week in which she works from 5 pm–9 pm
on Thursday night and 11 am–4:30 pm on Saturday.
23 A casual waitress is paid $9.20/h for any hours worked before noon and $11.50/h for hours
worked after noon. Calculate her pay for a week where she worked for the hours shown.
• Tues.—10 am to 3 pm • Thurs.—12 noon to 6 pm • Fri.—8:30 am to 1 pm
24 William is an apprentice plumber. He is paid a trade allowance of $8.80 per hour and works
40 hours each week.
a Calculate William’s regular weekly pay.
b If he receives a 5% increase, find William’s new hourly rate of pay.
c By how much has William’s weekly pay increased?
25 Liam is a bartender who earns $12.50/h for a 26-hour week. If his hourly wage is increased
by 7%, find:
a the increase in Liam’s fortnightly pay b Liam’s total annual pay
26 Last year Yvette was paid an annual salary of $36 500 as a chef in a French restaurant.
This year, her annual salary rose to $39 420 owing to an increase in the number of
customers. By what percentage did Yvette’s salary increase?
27 A teacher’s salary increased from $48 700 to $50 891.50. Calculate her percentage pay rise.
28 Brett was paid $585 per week last year as a car mechanic. He was laid off at the end of the
year and this year, he receives $2408.25 per month in his new job.
a Express each pay rate as an annual salary.
b Did Brett’s pay increase or decrease by changing jobs and by what percentage?

■ Further applications
29 Find the annual salary of each of these employees before they received the given pay
rise/cut.
Change in pay New salary
Greg Pay rise of 8% $29 160
Taleisha Pay rise of 5% $35 700
Lyselle Pay rise of 7.4% $45 967.20
Martin Pay cut of 9% $51 870
Taylor Pay cut of 11% $57 049
Peter Pay cut of 6.3% $79 410.75
72 Mathscape 9

30 Allen’s hourly rate of pay was increased by 4% and he now earns $686.40 for a 40-hour
week. How much would Allen have earned for a 35-hour week before the increase?
31 After receiving a pay rise of 7.5%, Laurie’s rate of pay increased to $19.35/h. How much
extra will Laurie earn over a full year if he works for 76 hours each fortnight?

TRY THIS Sue’s boutique

Sue Wilson opened a boutique on 1
January. She borrowed $60 000 from a
bank to start the business and agreed
to pay interest at the rate of 9% p.a. in
one instalment at the end of the year.
Sue had a good year, earning $343 300
from the sale of wearing apparel that
had cost her $170 880.
Her expenses for the year were as follows:
rent $380 per week; electricity and gas
$55 per week; insurance $104 per
week; salaries of employees $1660 per
week; and incidental expenses $110 per week. Sue paid herself $550 each week
as her salary.
After paying all expenses including the interest, what was Sue’s net profit for
the year? Could she repay some of her $60 000 debt to the bank? What would you
advise her to do?

3.2 Other methods of payment

While most permanent workers are paid a wage or a salary, an increasing number of Australians
are being employed in casual positions or in positions where they are paid according to what
they produce or sell.

■ Commission
A commission is usually quoted as a percentage of the value of goods sold. A small retainer or
basic weekly wage may also be paid. The greater the value of goods sold, the greater the income
is for that pay period. Sick pay, holiday pay and superannuation may or may not be paid. Those
who are paid on a commission basis must budget carefully for the weeks when their income is
substantially less than usual.
Typical occupations include salespeople and real estate agents.
 Chapter 3: Co n su mer arit hmet ic 73

■ Piece work
With piece work, the employee is paid a fixed amount of money for each item produced.
The more items a worker produces, the greater the pay for that pay period. Piece work positions
are usually of a temporary or casual nature, rather than permanent positions. Sick pay, holiday
pay and superannuation are not paid.
Typical occupations include textile workers, fruit pickers, decorators and printers.

■ Casual
Casual employees do not work a set number of hours per week but are employed when needed,
sometimes at short notice. A fixed amount is paid for each hour’s work. Higher hourly rates are
paid because they are not entitled to receive sick pay or holiday pay. Casual employees are paid
superannuation.
Typical occupations include tennis coaches, temporary secretaries and casual teachers.

Example 1 Solution
EG Caleb is a used car i Sales in excess of $30 000 = $53 000 − $30 000
+S
salesman. He is paid a = $23 000
weekly retainer of $150 plus ii Commission = 2% of $23 000
a commission of 2% on the = 0.02 × $23 000
value of his sales in excess
= $460
of $30 000. Find his total
iii Total pay = retainer + commission
pay for a week when his
sales total $53 000. = $150 + $460
= $610

Example 2 Solution
EG A printer charges $0.60 for Total pay = (250 × $0.60) + (600 × $0.15)
+S
each colour pamphlet = $150 + $90
produced and $0.15 for each = $240
black and white leaflet. How
much would he receive for
printing 250 colour
pamphlets and 600 black
and white leaflets?
74 Mathscape 9

Example 3 Solution
EG Trudi is a swimming i Pay for children 5–10 years = $15 × 9
+S
instructor. She charges $15 = $135
per lesson for children aged ii Pay for children 11–15 years = $219 − $135
5 to 10 years and $12 per = $84
lesson for children aged 11
iii Number of children 11–15 years = $84 ÷ $12
to 15 years. She is paid $219
=7
altogether for her 8 am class
on Saturday morning. If 9 of ∴ There are 7 children in the 11–15 years age group.
the children are aged
between 5 and 10 years, how
many children are aged
between 11 and 15 years?

Exercise 3.2

1 Calculate each of these commissions.

a 5% on sales of $12 000 b 2 3--4- % on sales of $9442 c 6.8% on sales of $3127

2 Kerrie is paid a commission of 12% on all perfume sales that she makes. Find her
commission for a week when she sells perfume products to the value of $2340.
3 A telesales representative is paid a fortnightly commission of 13.5% on the total value of
his sales. Find his commission for the previous fortnight when sales totalled $4200.

4 Gerard is a mobile phone sales representative. He is paid $15 for each new customer who
signs on to the network. How much will Gerard earn in a week when he signs up 33 new
mobile phone customers?
5 A factory worker is paid 22c for each gadget she constructs on the assembly line. Calculate
her pay for a week in which she constructs 2135 gadgets.
6 Karen is a textile worker who receives $11.75 for each garment she knits. How many
garments did Karen knit last week if she was paid $411.25?

■ Consolidation
1
7 Bill and Ben are furniture salesmen. Bill is paid a commission of 2 --2- % on his weekly sales,
while Ben is paid an annual salary of $29 500. Last week Bill sold furniture to the value of
$23 600. Who received the greater pay last week, and by how much?
8 Mohammed’s rate of commission was 7.5% in December and rose to 8% in January.
Calculate Mohammed’s total pay for these two months if his sales amounted to $27 800 in
December and $29 250 in January.
 Chapter 3: Co n su mer arit hmet ic 75

9 Petra is a sales representative for a large pay TV company. She is paid a weekly retainer of
$165 plus a commission of $25 for each new customer that she signs up. Find Petra’s total
pay for a week when she signs up 17 new pay TV customers.

10 Honest Al is a used car salesman. He is paid a basic fortnightly allowance of $340 plus a
commission of 1% on his sales. Calculate Honest Al’s pay for a fortnight when he sold cars
valued at $16 500, $21 990, $23 490 and $19 200.
11 Tonia’s weekly pay consists of a retainer of $240 plus a commission of 6 1--2- % on her sales.
Her daily sales for last week were:
• Mon.—$480 • Tues.—$535 • Wed.—$513
• Thurs.—$675 • Fri.—$608 • Sat.—$320
a Calculate Tonia’s total sales for the week.
b Find her total pay.

12 Norito is paid a basic fortnightly salary of $395 as well as a commission of 18% on the
value of all sales in excess of $16 500. Calculate his pay for a fortnight where his sales
totalled $21 475.
13 A real estate agent is paid a commission of 3% on the first $180 000 of the value of a
property and 2% on the remaining value. Find her total commission on the sale of each of
the following properties.
a A home unit sold for $175 000 b A house sold for $263 000

14 Miss Elle Itquik is a real estate agent. To sell a property, she charges a commission of 3 1--2- %
on the first $200 000 of the value of the property, 2 1--2- % on the next $150 000 and 1% on the
remaining value. If the house is sold at auction, there is an additional auction fee of $2875.
How much will she receive for selling a house at auction for $865 000?
15 Wade sold goods last week to the value of $7260. His pay for the week was $535.40, which
comprised a retainer plus a commission of 4% on his sales. How much is Wade’s retainer?
16 Joshua is employed to sell earth-moving equipment to construction companies. He is paid
an annual salary of $22 400 plus a commission of 11% on all sales in excess of $440 000.
Calculate his average fortnightly pay for a year when he sells $469 300 worth of equipment.
17 Roy is a junior Rugby League referee. He is paid $65 for each game that he referees on
weekdays and $85 for each weekend game. Find his total pay for a week in which he
referees games on Tuesday and Thursday evenings, two games on Saturday and another
game on Sunday.
18 Joy takes in extra ironing to help pay the bills. She charges $12 per basket for shirts and $7
per basket for trousers. Altogether Joy was paid $117 for 3 baskets of trousers and several
baskets of shirts. How many baskets of shirts did she iron?
19 A doctor charges $22.50 for consultations that last less than 10 minutes and $28.75 for
those that last longer than 10 minutes. How much will she be paid for a day in which she
sees 19 patients each for less than 10 minutes and 14 patients for longer than 10 minutes?
76 Mathscape 9

20 To pick up and deliver furniture the TLC Removal Company charges customers $50 per
hour for 2 men and $70 per hour for 3 men. The hourly rates apply from the time the truck
leaves the depot until its estimated return. There is an extra fee of $75 for customers moving
to or from an above-ground floor unit or double storey house.
a Calculate the total fee payable on a job where the truck leaves the depot at 7:30 am and
returns at 2:30 pm, 3 men are needed and the furniture is being delivered from a top-
floor unit to a house.
b If the company takes 34% of the money and the men split the remainder equally, find
the amount that each man will be paid.
21 A dentist charges $105 for an X-ray and $80 for a filling. Find the total charge for a man
who has 3 fillings as a result of his X-ray results.

22 An advertisement is placed in the major newspapers for experienced fruit pickers to pick
grapes in South Australia. The successful applicants are to be paid $180 per day, as well as
a dislocation allowance of $35 per week if they are from interstate. How much would an
experienced fruit picker from New South Wales earn if she was hired to pick grapes for
12 weeks?
23 Paul is a car windscreen fitter. He pays $110 for each standard windscreen and charges a
mark-up of 15% plus $28 for labour. Calculate Paul’s profit for a day when he installs
6 windscreens.
24 Jimmy Chan charges $25 to mow a medium-sized lawn, $35 to mow a large lawn and an
extra $5 to trim the edges. Find his total pay for a Saturday where he mows 5 medium-sized
and 3 large lawns and trims the edges around 6 lawns.
25 Adam runs a small printing company. He charges $21.80 to print 100 personal business
cards and $43 to print 50 colour brochures. How much will Adam be paid by a customer
who orders 350 business cards and 4000 colour brochures.
26 Deborah is contracted by a local toy store to make teddy bears. She is paid $8.20 per bear
for the first 40 bears, then $9.35 for each bear thereafter. How much will Deborah be paid
in a month where she makes 48 teddy bears?
27 As a travelling salesman, Nathan is
Distance
paid a weekly retainer of $140, a
Sales travelled (km)
commission of 8% on his sales, plus
a travel allowance of 48c per Monday $942 215
kilometre. The table below shows his Tuesday $564 72
daily sales and distance travelled for
Wednesday $1088 148
the first week of February.
a Find Nathan’s total sales. Thursday $740 95
b How far did he travel altogether? Friday $916 266
c Calculate Nathan’s total pay for
the week. Saturday $625 310
 Chapter 3: Co n su mer arit hmet ic 77

28 A stockbroker purchases 15 000 NRMA shares at $2.72 per share on behalf of a client. Her
brokerage fees are 2% on the first $2000 and 1.5% on the remaining value of the shares.
a Calculate the purchase price of the shares.
b How much will the broker receive in fees?

29 Tony the television repairman charges a call-out fee of $35, $42 per hour for labour, plus
the cost of parts. Mrs Anania books Tony to come to her house and repair the family’s
television set. The job takes 2 1--2- hours and requires new parts to the value of $55. How much
should Tony charge for the repair job?

■ Further applications

30 Diana is paid a retainer of $255 per week as well as a commission based on the value of her
weekly sales. By the end of the week she had sold $10 400 worth of automobile parts to
several retailers. If her total pay for the week was $463, find Diana’s rate of commission.
31 Roberta is a real estate agent. To sell a property, Roberta charges 3% on the first $200 000
of the value of a property, 2.5% on the next $150 000 and 2% on the remaining value. If the
property is sold at auction, she charges an extra $2350. Roberta successfully auctioned a
property and was paid $20 000 altogether in commission and auction fees. What was the
sale price of the property?

3.3 Overtime and other payments

Overtime is extra time worked beyond the regular number of hours. Overtime hours are
usually paid at 1 1--2- times or 2 times the normal hourly rate of pay. Such overtime rates are
commonly called ‘time and a half’ or ‘double time’ respectively.
A bonus is an extra payment or other benefit given to an employee as a reward for exceptional
performance in their job.
Holiday leave loading is a bonus given to all permanent wage and salary earners and some
other employees when they take their annual holidays. Employees are paid an additional 17 1--2- %
of 4 weeks normal pay, assuming that they take the maximum 4 weeks leave all at once.

Example 1 Solution
EG Ethan earns $15.10 per hour The first 38 hours are paid at the normal hourly rate, the next
+S
for a 38-hour week as an 5 hours are paid at 1.5 times the normal hourly rate and the
electrician. Overtime is paid final 3 hours are paid at twice the normal hourly rate.
at the time and a half rate for Pay= (38 × $15.10) + (5 × 1.5 × $15.10) + (3 × 2 × $15.10)
the first 5 hours and double = $573.80 + $113.25 + $90.60
time thereafter. Calculate = $777.65
Ethan’s pay for a week when
he works for 46 hours.
78 Mathscape 9

Example 2 Solution
EG Juanita works as a waitress and is i Overtime pay = $405 − $324
+S
normally paid $324 for a 30-hour = $81
week. For how many hours would ii Normal hourly rate of pay = $324 ÷ 30
she have worked in a week where = $10.80
her total pay is $405 if all overtime iii Hourly overtime rate of pay = $10.80 × 1.5
is paid at the time and a half rate? = $16.20
iv Number of overtime hours = $81 ÷ $16.20
=5
v Total hours worked = 30 + 5
= 35
∴ Juanita worked for 35 hours.

Example 3 Solutions
EG Keryn’s annual salary is $29 744. a i 4 weeks normal pay = $29 744 ÷ 52 × 4
+S
At Christmas, Keryn takes her = $2288
annual holidays and is paid 4 weeks
ii Holiday loading = 17 1--2- % of $2288
normal pay plus a holiday leave
loading of 17 1--2- % on this amount. = 0.175 × $2288
a Calculate the holiday leave = $400.40
loading. b Total pay = $2288 + $400.40
b Find Keryn’s total holiday pay. = $2688.40

Exercise 3.3

1 An employee’s normal rate of pay is $12 per hour. Find her overtime rate of pay at the:
a time and a half rate b double time rate
2 Merv is a motor car mechanic. His normal rate of pay is $16 per hour. How much overtime
pay would Merv earn by working for:
a 3 hours at the time and a half rate? b 4 hours at the double time rate?
c 2 1--2- hours at the triple time rate?

3 For how many hours would a person need to work at the normal hourly pay rate in order to
earn the same amount of money as that earned for working:
a 5 hours at the double time rate? b 4 hours at the time and a half rate?
c 6 hours at the double time and a half rate?

4 Calculate the total pay for a week in which a tradesperson works:

a 37 hours at $16/h and 4 hours at the time and a half rate
b 39 hours at $20.85/h and 3 hours at the double time rate
c 32 hours at $21.50/h and 3 hours at the time and a half rate
d 36 hours at $17.40/h and 5 1--2- hours at the double time rate
 Chapter 3: Co n su mer arit hmet ic 79

e 38 hours at $15.65/h, 2 hours at the time and a half rate and 4 hours at the double
time rate

■ Consolidation
5 Harry is an electrician who this week worked for 40 hours at the normal rate of $19.40 per
hour and an extra 6 hours overtime at the time and a half rate. Find Harry’s total pay for the
week.
6 A plumber worked for 36 hours at $22.50 per hour and 3 hours overtime at the double time
rate. Calculate his total pay for the week.
7 Elise is a textile worker. She is paid $12.30/h for the first 40 hours, time and a half for the
next 5 hours and double time thereafter. Calculate her pay for a week when she works:
a 40 hours b 44 hours c 50 hours

8 A construction worker earns $17.25/h for the first 38 hours worked and double time
thereafter. Find his total pay for a week when he worked for 46 hours.
9 Antoinette is paid at the rate of $14.50/h before 1 pm and at the time and a half rate after
1 pm. Find her total pay for a week when she worked 10 am–5 pm, Monday to Friday.

10 Hayden’s normal rate of pay is $24 per hour, Monday to Friday. He is paid at the time and
a half rate after 6 pm during the week and at the double time rate on weekends. Calculate
Hayden’s total pay for a week when he worked the following hours.
• Mon.—10 am to 6 pm • Tues.—10 am to 6 pm • Wed.—10 am to 8 pm
• Thurs.—1 pm to 9 pm • Sat.—10 am to 4 pm
11 Calculate the number of overtime hours worked by an employee who was paid:
a $20 per hour for the first 40 hours, earning $920 altogether, with overtime being paid
at the double time rate
b $18.80 per hour for the first 31 hours, earning $780.20 altogether, with overtime being
paid at the time and a half rate
c $17.45 per hour for the first 37 hours, earning $924.85 altogether, with overtime being
paid at the double time rate
12 A tradesperson normally earns $636.50 for a 38-hour week. For how many hours would
she have worked in a week where her total pay is $804, if all overtime is paid at the double
time rate?
13 Calculate the normal hourly rate of pay for an employee who was paid:
a $649.30 for working 34 hours at the normal rate and 6 hours at the time and a half rate
b $1029 for working 32 hours at the normal rate and 5 hours at the double time rate
c $684.45 for working 36 hours at the normal rate and 3 hours at the time and a half rate

14 A locksmith worked for 36 hours at $14.70/h and 6 hours overtime at the double time rate.
a Calculate his total pay for the week.
80 Mathscape 9

b How much less would the locksmith be paid if the overtime was paid at the time and a
half rate?
15 Last week, a groundsman worked for 34 hours at $13.80 per hour and 8 hours overtime,
which was paid at the time and a half rate.
a How much was the groundsman paid for the week?
b For how many hours would he need to work at the normal rate to earn the same amount
of money?
16 Madeleine’s employer gave her a Christmas bonus equivalent to 3% of her annual salary.
Find Madeleine’s bonus if she normally earns $1950 per fortnight.
17 An advertising salesman was given a bonus of 20% of one month’s pay as a reward for
creating a series of successful advertising campaigns. Find the amount of his bonus if he
usually earns $840 per week.

18 Leave loading is an annual bonus calculated on 17 1--2- % of 4 weeks normal pay. Find the
holiday leave loading that is due to an employee who earns:
a $640 per week b $1106 per fortnight
c $3120 per month d $48 340 per year

19 Pedro works for 38 hours each week and is paid $16.25 per hour. At Christmas, Pedro takes
his annual 4 weeks leave. He is paid 4 weeks pay plus 17 1--2- % leave loading on this amount.
Calculate Pedro’s total holiday pay.
20 A stockbroker earns an annual salary of $82 460. Calculate her total holiday pay if she takes
her annual 4 weeks leave in July.

■ Further applications
21 Calculate the fortnightly salary of an employee whose 4 weeks annual leave loading
amounts to $980.
22 Surangi was paid $3946 when she took her annual 4 weeks leave. This amount is composed
of her normal 4 weeks pay, holiday leave loading plus a bonus of $280. Find Surangi’s
normal fortnightly pay.

3.4 Wage deductions

A person’s total income before any amounts are deducted is called their gross income. Typical
deductions include income tax, superannuation, union fees and medical insurance. The amount
of money remaining after the deductions have been made is called the net income.

Net income = gross income − deductions

 Chapter 3: Co n su mer arit hmet ic 81

■ Income tax
The Australian government requires employers to deduct a certain amount of money from the
gross pay of their employees each pay period. This money is then paid to the government on
a monthly basis. Because the tax is taken out of employees’ pay packets on a regular basis, it is
called Pay As You Go or PAYG tax.

■ Superannuation
Superannuation is money set aside by an employee for their retirement. Upon retirement, it
can be taken either in a lump sum or in the form of regular payments. An employee can decide
how much, if any, of their gross income to save in this manner. Employers, however, are
required by law to contribute a percentage of each permanent employee’s wage or salary into
a superannuation fund on their behalf.

Example
EG A carpenter is paid a gross annual salary of $34 630. Each week he contributes 5% of his gross
+S
pay to a voluntary superannuation fund. His other weekly deductions are $166.50 in PAYG
tax and $6.90 for union fees.
a Calculate the total deductions. b Find the net weekly income.

Solutions
a i Weekly superannuation contributions = 5% of $34 630 ÷ 52
= 0.05 × $34 630 ÷ 52
= $33.30
ii Total weekly deductions = $33.30 + $166.50 + $6.90
= $206.70
b Net weekly income = gross weekly income – deductions
= ($34 630 ÷ 52) − $206.70
= $665.96 − $206.70
= $459.26

Exercise 3.4

1 Jack earns a gross weekly salary of $480. His employer deducts $116 in PAYG tax
instalments each week. What is Jack’s net weekly pay?
2 Julianne has a net weekly salary of $372 and deductions totalling $143. What is her gross
weekly pay?

3 Eve’s gross fortnightly pay is $1070. Each fortnight her employer deducts $313.40 in
PAYG tax instalments and she contributes $51.70 to a voluntary superannuation fund for
her retirement. Find Eve’s net weekly pay.
82 Mathscape 9

4 Calculate the net pay for each of these employees.

a Mick has a gross fortnightly wage of $964 and deductions of $210 in tax and $14.50 in
union fees.
b Yumi has a gross weekly wage of $755.40 and deductions of $213.10 in tax, $37.75 in
superannuation and $13.50 in health insurance.
c Nicholas has a gross monthly salary of $2690.80 and deductions of $794.65 in tax,
$21.30 in life insurance and $32.82 in union fees.

■ Consolidation
5 Mrs Hadlee has a gross annual salary of $32 568. Each week, the following amounts are
deducted from her pay: tax, $151.80; superannuation, $32.95; health insurance, $15.45.
Find her:
a gross weekly pay b total weekly deductions c net weekly pay

6 A printer is paid a gross weekly wage of $13.25 per hour for a 40-hour week. He has weekly
deductions totalling $195.20. What is his net weekly wage?
7 A fork-lift driver is paid a gross wage of $13.40 per hour for 75 hours per fortnight. He has
deductions of $303.15 in PAYG tax instalments and $15.50 for home and contents
insurance. Find his net fortnightly wage.
8 The gross hourly wage for a fitter and turner is $16 per hour for a 34-hour week. He has
$152.32 deducted in weekly tax instalments. What percentage of his:
a gross wage is paid in tax?
b net wage is paid in tax? (Answer correct to the nearest whole percentage.)

9 Maryanne receives a gross fortnightly wage of $1366 and her fortnightly deductions total
$524. Find her net monthly wage.
10 A ferry master is paid $13.80 per hour for a 40-hour week, with overtime paid at the time
and a half rate.
a Find his net pay for a week when he worked for 45 hours and had PAYG tax deductions
of $229.98.
b What percentage of his gross pay was paid in tax? (Answer correct to the nearest whole
percentage.)

11 A construction worker earns $19.60 per hour for a 38-hour week plus a weekly site
allowance of $18.90. Each week his employer deducts $267.30 in tax and 5% of the gross
wage is paid into a superannuation fund.
a How much money is paid into the superannuation fund each week?
b Calculate the worker’s net weekly pay.

12 Working as a crane operator, Barry earns $14.50 per hour. His normal working hours are
from 8 am to 4 pm, Monday to Friday, with overtime paid at the double time rate. Last
week, Barry worked the following hours:
• Mon.—8 am to 4 pm • Tues.—8 am to 5 pm • Wed.— 8 am to 5:30 pm
• Thurs.—8 am to 4 pm • Fri.—8 am to 4:30 pm
 Chapter 3: Co n su mer arit hmet ic 83

Each week Barry pays 7.5% of his gross wage (not including overtime pay) into a
superannuation fund. Last week his employer deducted $195.65 in PAYG tax instalments.
a What was Barry’s gross pay for last week, including overtime pay?
b How much money is deducted in superannuation payments each week?
c Calculate Barry’s net pay for last week.

■ Further applications

13 Dominique has a regular net weekly income of $468. Her employer deducts 35% of her
gross weekly income in tax. Find Dominique’s gross annual salary.
14 Last week Zachary worked for 36 hours at the normal pay rate and 4 hours overtime at the
double time rate. His employer deducted 43% of his gross income in tax, leaving a net
income for that week of $478.80. Calculate Zachary’s normal gross hourly pay rate.

3.5 Taxation
Under the Pay As You Go or PAYG tax system, employers deduct money each pay period from
the gross pay of their employees. Self-employed people need to organise this themselves. This
money is then paid to the government on a monthly basis. The amount of money deducted
varies with each employee according to their gross income and the tax scales in operation at the
time.
The financial year begins on 1 July and ends on 30 June. At the end of each financial year,
employers are required to give each employee a payment summary form. The payment
summary form shows the annual income, deductions such as union fees and superannuation,
and the amount of tax that has been withheld during the year. Employees, and those who are
self-employed, must then fill in a tax return form and lodge it with the Australian Taxation
Office (ATO) on or before 31 October. If a person does not lodge the form in time, they may
be fined.
The amount of tax that each person must pay is based on their taxable income. The taxable
income is calculated by finding the total gross income (e.g. salary, bank interest, rent from an
investment property) and then subtracting any allowable tax deductions (e.g. work-related
expenses, travel expenses, charitable donations). People can minimise the amount of tax that
they have to pay by claiming as many legitimate tax deductions as possible.

Taxable income = total gross income − allowable tax deductions

84 Mathscape 9

The table below is the 2000/2001 tax table for Australian wage and salary earners. It can be
used to work out how much tax a person has to pay. The taxable income is always rounded
down to the nearest dollar.
Taxable income Tax payable
$1–$6000 Nil
$6001–$20 000 17 cents for each $1 over $6000
$20 001–$50 000 $2380 + 30 cents for each $1 over $20 000
$50 001–$60 000 $11 380 + 42 cents for each $1 over $50 000
$60 001 and over $15 580 + 47 cents for each $1 over $60 000
Sometimes the amount of tax taken out by employers is not enough because the employee has
earned extra income from other sources. In this case, the person may have to pay more tax to
the government. If, however, the employer has taken out too much tax because the employee
is able to claim several tax deductions, then the person may receive a tax refund.
As well as paying income tax, Australians contribute to the cost of funding the public health-
care system through the payment of an annual Medicare levy. The table below shows the levy
payable by individual taxpayers. The amount payable may also vary according to an
individual’s circumstances.
Taxable income Medicare levy
$1–$13 807 Nil
$13 808–$14 926 20 cents for each $1 over $13 807
$14 927 and over Flat 1.5% of taxable income

Example 1
EG Imelda earns $28 490 as a floor polisher. Last year her employer took out $5290 in PAYG tax
+S
instalments.
a Calculate the tax payable.
b Is Imelda entitled to a tax refund or does she have to pay more tax? Explain.

Solutions
a A taxable income of $28 490 falls into the $20 001 to $50 000 tax bracket.
i We first need to calculate by how much this salary exceeds $20 000.
Now, $28 490 − $20 000 = $8490.
ii Tax payable = $2380 + (30c for each $1 over $20 000)
= $2380 + (0.3 × $8490)
= $2380 + $2547
= $4927
b $5290 − $4927 = $363. The amount of tax taken out is $5290, which is greater than the
tax payable, $4927.
Therefore, Imelda is entitled to a tax refund of $363.
 Chapter 3: Co n su mer arit hmet ic 85

Example 2
EG Arjuna earns $56 315 as a construction engineer. In the last financial year he also earned $436
+S
in interest on his savings and he had allowable tax deductions totalling $3720.
a Find the taxable income. b How much tax should he have paid?
c Find the average net weekly income.

Solutions
a Taxable income = total gross income − allowable tax deductions
= ($56 315 + $436) − $3720
= $53 031
b i $53 031 − $50 000 = $3031.
ii Tax payable = $11 380 + (42c for each $1 over $50 000)
= $11 380 + (0.42 × $3031)
= $11 380 + $1273.02
= $12 653.02
c i Net annual income = total gross income − tax
= ($56 315 + $436) − $12 653.02
= $44 097.98
ii Average net weekly income = net annual income ÷ 52
= $44 097.98 ÷ 52
= $848.04

Exercise 3.5

1 Use the tax table on page 84 to calculate the tax payable on each annual salary.
a $5200 b $13 000 c $34 750 d $53 345
e $71 260 f $46 863 g $58 758 h $172 510
2 Mr Ford has an annual salary of $56 300. His tax accountant told him that he could claim
a total of $2580 in tax deductions.
a Find Mr Ford’s taxable income. b Calculate the tax payable on this income.

■ Consolidation
3 Kurt has two jobs. During the day he works as a builder’s labourer and in the evening he
works in a café. As a labourer, Kurt is paid $601.25 per week while the owner of the café
pays him $446 per fortnight. Find:
a Kurt’s total annual income b the amount of tax payable on this income
86 Mathscape 9

4 After leaving school, Denise got a part-time job working at a service station and was paid
a weekly wage of $285. Because she was studying at university in the evenings, Denise was
able to claim tax deductions of $744 at the end of the financial year for educational
expenses.
a What was Denise’s gross annual income?
b Find her taxable income.
c How much tax must Denise pay on her annual income?

5 As a computer systems analyst, Tim earns an annual salary of $74 300. Last year he earned
an additional dividend of $4065 on his share portfolio and $710 interest on his savings. He
had allowable tax deductions of $4351.80.
a Calculate Tim’s gross annual income. b Find his taxable income.
c Find the amount of tax that Tim must pay.

6 Stefan’s gross fortnightly pay is $1610.58. His employer took out $384.60 each fortnight
in PAYG tax instalments.
a Find Stefan’s gross annual income. b Calculate the tax payable on this income.
c Is Stefan entitled to a tax refund? If so, how much?

7 Bettina’s gross monthly pay is $4447.08. In the last 12 months she earned interest of
$294.50 on her savings, $2870 on a real estate investment and had allowable tax deductions
totalling $385.40. Her employer deducted $985.34 each month in PAYG tax instalments.
a Find Bettina’s gross annual income. b Find her taxable income.
c Calculate the tax payable.
d Will Bettina receive a tax refund or does she have to pay more tax? Explain.

8 Alana’s gross weekly income is $475.48 and she has allowable tax deductions of $412.72.
Find:
a her gross annual income b her taxable income
c the tax payable d her net weekly income

9 Find the net fortnightly income on a gross annual salary of $64 312, with allowable tax
deductions totalling $2140.
10 Ian’s gross weekly pay last year was $924. At the end of the year he received a 10% pay
rise.
a What was Ian’s net weekly pay before the pay rise?
b What was Ian’s net weekly pay after the pay rise?
c By how much has Ian’s weekly take home pay increased?

11 The normal working week for a steelworker is 39 hours at $18.75 per hour, with overtime
being paid at the time and a half rate. Last year the steelworker worked 146 hours overtime
on top of his regular hours and had allowable tax deductions of $1178.40.
a Calculate his gross income for the year.
b Find the tax payable on this income.
c Calculate the tax refund to which he is entitled if PAYG tax instalments of $168.23
were deducted from his gross pay each week.
 Chapter 3: Co n su mer arit hmet ic 87

12 Doug’s gross fortnightly salary is $1448. At Christmas he receives 4 weeks pay plus a
holiday leave loading of 17 1--2- %. During the year, he spent $4200 on dental work and was
able to claim 20% of this amount in excess of $1250 as a tax deduction.
a Calculate Doug’s gross annual salary including the leave loading.
b Find the taxable income.
c How much tax should Doug pay on this taxable income?

13 Erlinda invested $16 400 and was paid interest on this amount at 6% per annum for the
financial year ending 30 June. She was required to declare this interest as part of her taxable
income. Erlinda’s gross fortnightly salary is $2209.
a How much interest did she receive on the investment?
b Calculate the amount of tax that Erlinda paid last financial year.

14 Dobey’s monthly salary for the first 6 months of the financial year was $3095.15. He then
received a 12% pay rise. How much tax should Dobey pay for that financial year?

15 Paula’s gross annual salary is $45 000. Her tax advisor approved the following tax
deductions:
• 40% of the cost of a new computer that was purchased for $3570
• $396.20 for stationery
• $572.90 for work-related travel expenses
• $151.75 for dry-cleaning of uniforms
• $384.55 for union fees
a What is the total value of Paula’s tax deductions?
b What is her taxable income?
c Calculate the tax payable on this income.

16 Prior to the reform of the Australian tax system in 2000, a person with an annual income of
$49 000 paid tax of $8942 plus 43 cents for each $1 earned over $38 000.
a Calculate the tax payable on an income of $49 000 under the old tax scale.
b Calculate the tax payable on this income under the new tax scale.
c How much better off per week is a person with this income under the new tax scale?

17 Giselle is paid a weekly retainer of $145.65 plus a 5% commission on the value of her sales.
Last year, Giselle sold books to the value of $652 375. She claimed a total of $2966.30 in
tax deductions for the year.
a Find her gross annual income.
b Find the tax payable.
c What was Giselle’s average net weekly pay last year?

18 Individual Australian taxpayers whose taxable income is greater than $13 807 are required
to pay an annual Medicare levy to contribute to the cost of public health care. The payment
scale is shown on page 84. An additional 1% Medicare levy surcharge is payable by
individual taxpayers with a taxable income greater than $50 000 per annum who have not
taken out private health insurance with a registered health fund.
88 Mathscape 9

Calculate the annual Medicare levy payable on a taxable income of:

a $12 500 b $21 000 c $14 260

19 Harley is an engineer with a taxable income of $95 400. He does not have private health
insurance.
a Does Harley have to pay the extra Medicare levy surcharge of 1%?
b How much will he pay altogether for Medicare?
c Would Harley be better off by paying $675 per year for private hospital cover? If so,
by how much?

20 Glenda is an industrial chemist with a taxable income of $48 460. Her employer has
deducted $185 per week in PAYG tax instalments.
a Calculate the tax payable on this income.
b Calculate the Medicare levy payable on this income.
c How much tax has been deducted from Glenda’s annual salary?
d Is Glenda entitled to a refund or does she have to pay more tax? In either case, state the
amount.
21 Dilini has a gross annual salary of $75 484 and last year she earned $4620 in dividends on
her shares. She had allowable tax deductions of $725 for work-related travel expenses and
$594 for other expenses. Dilini has top private hospital cover. Her employer deducted
$528.30 in PAYG tax instalments each week from her gross pay.
a Find her taxable income.
b Calculate the amount of tax that she should pay on her income.
c How much should Dilini pay for Medicare?
d Is Dilini entitled to receive a tax refund? If so, how much?

■ Further applications
22 Find the taxable income of an employee who paid the amounts below in tax. (Ignore the
Medicare levy.)
a $1598 b $4870 c $13 358.20 d $31 847.64

23 Victor earns a regular hourly rate of pay for working 35 hours per week as an electrician
and is not eligible to earn overtime pay. In the previous financial year he paid $14 160.40
in tax and also paid a Medicare levy. He had total tax deductions of $3790.35. Find:
a his taxable income b the Medicare levy c his hourly rate of pay

3.6 Budgeting
A budget is an organised spending plan based upon a person’s net income. It is important to
work out your spending habits and make an accurate budget so that you have enough money at
hand when bills come in. Some bills vary a lot at different times of the year and unexpected
expenses may also occur. It is wise to save as much money as you can so that you are not
caught out.
 Chapter 3: Co n su mer arit hmet ic 89

Example
EG Helen has just moved out of home. She Item Weekly expenses
+S
has a net income of $540 per week as a Rent $160
video technician and spends 1--9- of her
income on food. Helen has created this Car loan repayment $125
weekly budget to manage her finances. Petrol $35
a How much does Helen spend on food Food
each week? Clothes $30
b How much money does she save
each week? Entertainment $45
c What percentage of her income does Savings
Helen spend on rent, correct to
1 decimal place?
d If Helen’s budget was represented on a sector graph, what would be the central angle in
the ‘clothes’ sector?

Solutions
1
a --- × $540 = $60
9
b Savings = $540 − ($160 + $125 + $35 + $60 + $30 + $45)
= $540 − $455
= $85
160 30
c --------- × 100% = 29.6% d Central angle = --------- × 360°
540 540
= 20°

Exercise 3.6

1 Partima has a net weekly income of $410. She has Partima’s weekly budget
formulated a weekly budget plan in order to manage
Rent $205
her money.
a How much does Partima save each week? Transport $28
b Partima pays the rent on a fortnightly basis. Food $75
How much rent does she pay each fortnight?
Entertainment $50
c What percentage of her net income does she spend on
food? Answer correct to the nearest whole percentage. Savings
90 Mathscape 9

2 Kendra earns $572 per week after tax. She lives Kendra’s weekly budget
alone and has just bought a new car on terms.
She sets aside equal amounts of money for bills Rent $185
and entertainment. Car loan repayment $76
a How much does Kendra set aside for bills?
Petrol $42
b What are her annual expenses for rent?
c What percentage of her income does Kendra Bills
save? Answer correct to the nearest whole Clothes $35
percentage.
Entertainment
Food $75
Savings $29

3 Reggie shares a house with 3 friends. They pay Reggie’s weekly budget
$320 per week in rent and share equally the payment
of the rent and all bills. This year they estimate that Rent
the bills will amount to approximately $2080. Bills
a How much does Reggie contribute each week Entertainment $65
for: i rent? ii bills?
b What is Reggie’s net weekly income? Transport $22
c What fraction of his income is spent on food? Food $60
d How much more does Reggie spend on rent Clothes $45
than on entertainment?
Savings $38

■ Consolidation
4 Stuart lives at home with his parents. He goes to Stuart’s weekly budget
university at night and works as a storeman and
packer by day. He pays 30% of his net income to Food and board $105
his parents for food and board. Entertainment
a What is Stuart’s net weekly income? Uni. expenses
b He budgets $10 more per week for
entertainment than for his university expenses. Petrol $40
How much does he budget for each item? Clothes $45
c If this budget was to be shown on a sector graph, Savings $70
what size would the central angle be for
savings?
d Stuart received a pay rise of 12% and he decided to split this extra amount between
what he spends on clothes and what he pays for food and board. How much will he
spend on clothes after the pay rise?
 Chapter 3: Co n su mer arit hmet ic 91

5 Virgil constructed this sector graph to illustrate his Virgil’s weekly budget
weekly budget.
a Virgil spent twice as much on food as he did on
Entertainment
transport. What angle should be shown for each
of these sectors? Clothes
b What fraction of his weekly income does Virgil 30°
150°
spend on clothes?
c Virgil pays $225 per week in rent. Find his net Rent Transport
weekly income. Food
d Is this a good budget? Explain.

6 Anthea has a net annual salary of $27 300. She has weekly expenses of $17.50 for health
insurance, $37 for petrol and $80 for food. She pays $480 per fortnight for rent and $78 per
month for car insurance. She wants to allow $75 per week for savings. Draw up a weekly
budget for Anthea, with the remaining money being divided equally between savings and
‘other expenses’.
7 Brett earns $16.50 per hour after tax for a 36-hour week. He pays $354 each fortnight for
rent and has weekly expenses of $110 for food and $48 for petrol. His annual expenses are
$1550 for bills and $940 for car insurance. Brett pays 5% of his weekly wage into a
superannuation fund for his retirement. The rest of his money is deposited into a savings
account. Draw up a weekly budget for Brett, rounding off all amounts to the nearest dollar.
8 Jillian wants to buy a new car. She took out a car loan and agreed to make regular monthly
repayments for 5 years. She will also need to budget for the following costs:
• Petrol—$35 per week • Servicing—$280 every 6 months
• Loan repayment—$355 per month • Green slip—$315 per annum
• Insurance—$75.40 per month • Registration—$225 per annum
• Driver’s licence renewal—$35 per annum
a How much will Jillian eventually pay on the car loan?
b What is the total annual running cost of this car?
c How much will Jillian need to budget each week to cover these costs?
d Calculate the total cost of buying and running this car for 5 years.

■ Further applications

9 a Select a job that appeals to you from the employment section of a newspaper and note
the annual salary/pay conditions.
b Read through the real estate section and select a house/home unit that you can afford to
rent on this salary.
c Choose a new/used car from the motoring section and note the purchase price and
repayment costs.
d Get copies of recent family bills for electricity, water, gas, telephone and so on and
estimate the weekly costs for a single person.
e Prepare a complete weekly budget, including rent, car payments, bills, petrol, clothes,
entertainment, insurance, food and savings. How much money is left over?
92 Mathscape 9

TRY THIS Telephone charges

The following is a summary of a report that was
published in a newspaper.
‘Charges for Telco Blue long-distance telephone
calls will be slashed by up to 31%. This will save
consumers $100m per year. The biggest
reductions will be on the longest distances, for
example Sydney-to-Melbourne calls are slashed
from 67c to 46c for 3 minutes and Brisbane-to-
Perth calls will fall from 90c to 68c for 3
minutes.’
a Find the percentage decrease in the costs of the 2 calls quoted in the article.
b A firm had a telephone bill in 2002 of $12 580 for calls. An examination of the
account showed that 35% of the sum was due to long-distance calls. In making
a budget for 2003, the firm assumes that the number of local and long-distance
telephone calls will stay in the same ratio and both will increase by 10%. It is also
allowing for a 25% reduction in the cost of long-distance calls because of the
Telco Blue announcement (since the phrase ‘up to 31%’ was used!). Calculate the
firm’s estimate of its 2003 telephone bill for calls.

3.7 Best buys

Many products are sold in containers or packets of varying sizes. Usually, buying the larger
quantity provides better value for money since the manufacturer is able to cut down on
packaging and delivery costs. However, on some occasions, the retailer may have a surplus of
other-sized stock that needs to be sold to make room for new stock. This stock may be
discounted considerably, making it the best buy.

Example 1
EG Which of these is the best buy?
+S
A 10 kg for $13 B 15 kg for $19.95 C 20 kg for $25 D 30 kg for $38.40

Solution
The lowest common multiple of 10, 15, 20 and 30 is 60. We therefore compare the costs of
purchasing 60 kg of the product in each case.
A 10 kg for $13 B 15 kg for $19.95 C 20 kg for $25 D 30 kg for $38.40
×6 ×6 ×4 ×4 ×3 ×3 ×2 ×2
= 60 kg for $78 = 60 kg for $79.80 = 60 kg for $75 = 60 kg for $76.80
∴ C is the best buy.
 Chapter 3: Co n su mer arit hmet ic 93

Example 2
EG Which of these is the best buy?
+S
A 5 L for $42.25 B 6.8 L for $57.12
C 10.2 L for $86.70 D 12 L for $100.20

Solution
The lowest common multiple of 5, 6.8, 10.2 and 12 is not obvious. We therefore find the cost
of 1 L of the product in each case.
A 5 L for $42.25 B 6.8 L for $57.12
÷5 ÷5 ÷ 6.8 ÷ 6.8
= 1 L for $8.45 = 1 L for $8.40
C 10.2 L for $86.70 D 12 L for $100.20
÷ 10.2 ÷ 10.2 ÷ 12 ÷ 12
= 1 L for $8.50 = 1 L for $8.35
∴ D is the best buy.

Exercise 3.7

1 Determine the best buy in each of these by finding the cost of:
a 100 g of each item.
A 10 g for $2.40 B 20 g for $4.50
C 50 g for $11.50 D 100 g for $23.80
b 2 L of each item.
A 200 mL for $8.52 B 400 mL for $16.84
C 500 mL for $20.90 D 1 L for $41.90
c 60 kg of each item.
A 10 kg for $30.10 B 15 kg for $45.85
C 20 kg for $61.60 D 30 kg for $91.20
d 1500 mL of each item.
A 100 mL for $1.27 B 250 mL for $3.08
C 300 mL for $3.75 D 500 mL for $8.30

2 Find the best buy in each of these.

a A 5 cm for $1.25 B 8 cm for $2.32
C 10 cm for $2.70 D 20 cm for $5.56
b A 5 g for $1.80 B 15 g for $4.95
C 25 g for $9.50 D 75 g for $29.25
c A 6 kg for $4.86 B 8 kg for $6.80
C 9 kg for $7.02 D 12 kg for $9.90
d A 1--4- L for $23.13 B 2
--- L for $35.60
5
1
C --- L
2
for $45.75 D 1 L for $87.50
94 Mathscape 9

■ Consolidation
3 Find the unit cost of each item and hence determine the better buy in each of these.
a 30 mL for $2.10 or 65 mL for $4.88 b 85 cm for $5.19 or 95 cm for $5.89
c 7 kg for $29.61 or 12 kg for $50.28 d 75 g for $10.16 or 125 g for $17.03

4 A 1.25-L bottle of lemonade is priced at $1.45 while a 2-L bottle is priced at $2.40. Which
size represents the better value?
5 Bird seed is sold in 3 sizes: 500 g for $1.78, 1 kg for $3.45 and 1.75 kg for $5.90. Which
size represents the best value for money?
6 Oz Tea is sold in 3 different-sized packets: 100 g for $1.75, 200 g for $3.40 and 250 g for
$4.35. Which sized packet of tea is the most expensive per gram?
7 Screen doors are advertised for sale at $180 each or 3 for $500. Daniel needs to replace the
screen door at the front of his house after an attempted break-in. Which purchase option is
better for Daniel? Why?
8 Gary needs 2 tins of paint to paint his son’s bedroom. Paint is advertised for sale at $9.50
per tin or ‘buy 3 tins and get 1 free’. Which purchase option should Gary make? Why?

■ Further applications
9 A 1 kg bag of prawns costs $7.60 while a 3 1--2- kg bag costs $26.75.
a Which size represents the better buy?
b At what price should a 2 1--2- kg bag be sold if it is to represent equal value for money with
the best buy?
10 Potatoes are sold in 2 kg bags for $2.80 and 5 kg bags for $7.10. Find the maximum price
at which a 3 kg bag should be sold if it is to be the best buy by 10%.

3.8 Discounts
A discount is a reduction in price of an item that is for sale. It is usually expressed as a
percentage of the marked price. Retailers offer discounts to encourage customers to shop in
their store or to quickly sell any remaining stock before the new stock arrives.
Some stores offer consecutive discounts on the marked price of an item. That is, they offer a
discount on the already discounted price. It is important to note that the two discounts must be
worked separately. You cannot simply add the percentages and make one calculation.
Consecutive discounts are usually offered for customers who are paying cash rather than using
a credit card.
 Chapter 3: Co n su mer arit hmet ic 95

Example 1
EG A Christmas tree with a marked price of $35 is marked for sale at 40% off in early January.
+S
a Calculate the discount. b Find the new retail price.

Solutions
a Discount = 40% of $35 b New retail price = marked price − discount
= 0.4 × $35 = $35 − $14
= $14 = $21

Example 2
EG
+ S A customer purchased a lounge chair with a marked price of $1100 at the mid-year sales, where
everything in the store was advertised at 15% off. He was also given a further discount of 2%
because he paid cash. How much did the customer pay for the chair?

Solution
i If the chair was discounted by 15%, then ii After a further discount of 2% was
the customer would only have paid 85% allowed, the customer only paid 98% of
of the marked price. the discounted price.
85% of $1100 = 0.85 × $1100 98% of $935 = 0.98 × $935
= $935 = $916.30
∴ The customer paid $916.30 for the chair.

Example 3
EG Xiang paid $42 for a pair of jeans at a 25% off sale. What was the marked price of the jeans
+S
before the discount was allowed?

Solution
The unitary method is used to find the original price of a discounted item. Since a discount of
25% was allowed, the purchase price must have been 75% of the marked price.
75% of the marked price represents $42
÷ 75 ÷ 75
∴ 1% of the marked price represents $0.56
× 100 × 100
∴ 100% of the marked price represents $56
∴ The jeans cost $56 before the discount was allowed.

Exercise 3.8

1 Niles was given a discount of 25% when he purchased a new set of tyres for his car. What
percentage of the retail price did he pay?
96 Mathscape 9

2 Find the following discounts:

a 25% off the retail price of a $580 dishwasher
b 40% off the retail price of a $130 heater
c 33 1--3- % off the retail price of a $216 bicycle

3 Find the new sale price of each of these items.

a A cassette recorder valued at $48, after a 20% discount is applied.
b A child’s stroller with a marked price of $195 if a discount of 15% is allowed.
c An electric kettle with a price tag of $36.50 if a discount of 12 1--2- % is advertised.

■ Consolidation

4 An electrical goods super store is holding a post-Christmas sale, with discounts of 15% on
all television sets, 20% on refrigerators and 12 1--2- % on ovens and ranges. Find the new sale
price for each of these electrical goods.
a b c

0
72 04
5 $8 $1
26
$1

5 A book store offers teachers a 15% discount on all books. Mrs Hosogoe purchased 2 books
priced at $29.95 each and 3 books priced at $24.75 each. Find:
a the total cost without the discount b the total cost with the discount

6 A dishwasher was advertised at $640 with a further $175 for installation. Calculate the total
purchase and installation costs if the cost of the dishwasher (excluding installation) is
reduced by 18% due to minor scratching.
7 An outdoor television antenna is advertised with a marked price of $115 with $25 extra
for installation. Find the total purchase and installation cost of an antenna during a sale in
which all antennas are being discounted by 10% and installation costs are being discounted
by 20%.
8 John purchased a 4-cylinder mower with a MO’s MOWERS
price tag of $340. He received the advertised
discount, plus a further 5% off the discounted HUGE
price for paying cash. How much did John pay DISCOUN
for the mower? TS
• 10% off all 2 cylinder mowers
• 15% off all 4 cylinder mowers
 Chapter 3: Co n su mer arit hmet ic 97

9 Mrs Lee purchased the following items for her daughter in preparation for the new school
year:
• 4 pens at 95c each • a bottle of liquid paper costing $1.85
• an eraser costing 50c • 8 exercise books at $1.14 each
• a ruler costing 43c • a pencil sharpener costing 24c
Find the change from $20 if a discount of 10% was given on the cost of each stationery
item.
10 The owner of a local video rental store placed the following sign in the window: ‘Rent
any 4 movies and get one free’. What percentage discount is being offered on the hire of
5 movies?
11 Find the percentage discount that was allowed if a pair of shoes with a retail price of $150
was sold for $117.
12 The price of a book was reduced from $42 to $36.54. What percentage discount is this?

13 A T-shirt with a marked price of $35 was discounted and sold for $25 at a mid-year sale.
Calculate the percentage discount, correct to 1 decimal place.

14 The retail price of a school bag was reduced by $11 to $28. Find, correct to 1 decimal place,
the percentage discount.
15 A motorbike was discounted by 10% and sold for $5220. What was the cost of the
motorbike before the discount was applied?
16 A set of encyclopaedias was sold for $410.40 after being discounted by 28%. Find the cost
of the encyclopaedias before the discount was applied.
17 A pair of jeans was reduced by 35% and sold for $61.75. What was the price of the jeans
before the discount was applied?

18 Tamara bought a blouse at this sale, where items were listed

as 30% off. What was the original retail price of the blouse if
Tamara paid $43.40?

19 Kerryanne bought a guitar at a 35% off sale at the markets

and paid $136.50. How much did she save?
20 Drivers who do not make a claim on their car insurance receive
a 10% no-claim bonus each year.
a Would a driver receive a no-claim bonus in their first year?
b Catherine has been driving for 4 years and has a perfect
driving record. What percentage would her no-claim
bonus be?
c How much will Catherine have to pay to insure her car if the
full insurance premium is $810?
98 Mathscape 9

■ Further applications
21 The children’s entry price into a pantomime is set at 60% of the adult’s price. Find the
total entry price for a family of 2 adults and 3 children if 1 adult and 1 child can enter for
$24.
22 The cost of a camera was reduced by 20% in January with a further 5% discount being
given for paying cash. A tourist paid $516.80 cash for a camera. What was the original
price?
23 A leather handbag was discounted by $x and then sold for $y. Find the percentage discount
in terms of x and y.

TRY THIS Progressive discounting

A sales representative is eager to sell you a car. He offers you three successive
discounts on the car (5%, 10%, 15%) in any order that you wish. Which order
should you choose?

3.9 Profit and loss

The terms profit and loss refer to the difference between the cost price and selling price of an
item. This difference is called a profit if the selling price is greater than the cost price and a
loss if the selling price is less than the cost price.

Profit = selling price − cost price
Loss = cost price − selling price

In business, the manufacturer makes products, marks up the cost, then sells them to a
wholesaler. The wholesaler marks up the cost and then distributes the products to a retailer.
The retailer marks up the price and then sells the products to customers in their store. The
mark-up is usually a percentage of the purchase price at each stage.
 Chapter 3: Co n su mer arit hmet ic 99

To express the profit or loss as a percentage of the cost price or selling price:

calculate the profit or loss

divide the profit or loss by the cost price or selling price
100

multiply by --------- %.
1
Percentage profit or loss is calculated on the cost price unless otherwise stated.

Example 1
EG Quentin bought a bicycle for $150 and sold it six months later, making a loss of 30% on the
+S
purchase price. Find the selling price.

Solution
i Loss = 30% of $150 ii Selling price = cost price − loss
= 0.3 × $150 = $150 − $45
= $45 = $105

Example 2
EG A retailer purchased an electric fan for $30 and sold it for $42. Calculate the percentage profit.
+S
Solution
profit 100
i Profit = selling price − cost price ii Percentage profit = ----------------------- × --------- %
cost price 1
= $42 − $30
= $12 12 100
= ------ × --------- %
30 1
= 40%

Exercise 3.9

1 Find the selling price of an item that was purchased for $750 and sold at a:
a profit of $120 b loss of $150

2 Find the cost price of an item that was sold for $430 at a:
a loss of $50 b profit of $160

3 A piano was bought for $2900 and sold three years later at a loss of 30%. Find:
a the loss b the selling price

4 Heather purchased a painting for $3500. She later sold the painting at an auction, making a
profit of 40%. Find:
a the profit b the selling price

5 Ted bought a boat for $18 500 and sold it two years later to his brother, making a loss of
25%. How much did Ted’s brother pay for the boat?
100 Mathscape 9

■ Consolidation
6 The wholesale price of a DVD player was $520 and the retail price was $650. Express the
profit as a percentage of the:
a wholesale price b retail price

7 Annika bought a tennis racket for $80 and sold it 6 months later at a garage sale for $56.
Express the loss as a percentage of the cost price.
8 A jeweller bought a pearl necklace for $2100 and sold it to a customer at a profit of 45%.
Express the profit as a percentage of the selling price, correct to the nearest whole per cent.
9 Ricardo purchased a house for $325 000 in 1990 and sold it for $594 750 in 2001. Calculate
the percentage profit.
10 Steve bought a coffee table for $120 and sold it later at a garage sale for $54. Find the
percentage loss.
11 How is the cost price of an item related to the selling price if a profit of 100% was made on
the sale?

12 If an item is sold at a profit of 300%, find in simplest form the ratio of selling price : cost
price.
13 A company sells mobile phones at a loss of 30% on their wholesale price of $160. Other
charges include a network connection fee of $25 and 12c per minute for calls. Calculate the
overall first month profit or loss on the sale of a mobile phone to a customer who makes
15 3--4- hours worth of calls in that month.
14 Freda owns a cake shop franchise. Last week she accepted delivery for cakes to the value
of $3240. She sells the cakes with a mark-up of 48%. The running costs for the week
amount to $955. Find the total profit for the week after all running costs are taken into
account.
15 A retailer purchased 500 calculators from a wholesaler for $10 000, then marked up their
price by 40%. Find:
a the retail price of each calculator
b the total profit earned when all of the calculators have been sold

16 Tori bought 7000 shares in a telecommunications company in 1996 and sold them 5 years
later. If the share price was $3.25 at the time of purchase and $3.08 at the time of selling,
find:
a the total loss made on these shares
b the percentage loss, correct to 1 decimal place

17 Yvonne sold her home unit for $224 000, making a profit of 28% on the purchase price.
How much did she pay for the unit?
 Chapter 3: Co n su mer arit hmet ic 101

18 Daryl sold his car for $8500, which represented a loss of 55% on the original purchase price
due to depreciation. How much did Daryl pay for the car originally?
19 A shop owner sold a computer for $2875, making a profit of 32% on the wholesale price.
What was the wholesale price of the computer?

20 The owner of a sports store marks up the cost of cricket balls by 15% and cricket bats by
40%. One boy paid $280 for one bat and three balls while a second boy paid $248 for one
bat and one ball.
a Find the retail price of each bat and ball.
b Find the wholesale price of each.
c Calculate the total profit made on these sales.

■ Further applications
21 A manufacturer sells plates to a wholesaler at cost plus 20%. The wholesaler then marks up
the price by a further 25% and sells them to a retailer. The retailer then sells the plates for
$4.20 each, making a profit of 40%. How much would it cost to manufacture 200 plates?
22 A factory owner pays his 3 employees $12.50 per hour for 36 hours per week to
manufacture mouse traps. Each employee can make 40 mouse traps per hour. The owner
pays 75c per trap for parts and $490 per week in other business overheads, such as rent,
electricity and telephone charges.
a Find the weekly wages bill.
b How many traps are produced each week?
c Calculate the total cost of running the business per week
d For how much should each trap be sold to a wholesaler if the factory owner is to make
a profit of at least $800 per week?
 102 Mathscape 9

0FF OCUS ON
O R K I N
I CAAL LL LYY
O C U S O N W 0 R K I N G M AATTHHEEMMAATTI C
G W M
MATHEMATICALLY

SYDNEY MARKET PRICES IN 1831

MATICALLY

Introduction
The first edition of the Sydney Herald was published on Monday 18 April 1831. It was not until
F O C U S O N W O R K I HNE G

1840 that the Herald became a daily, the Sydney Morning Herald. One of the interesting
columns was headed Markets. It included prices at the Sydney markets on a wide range of
goods. In those days, in fact up to 1966, Australia’s currency was in pounds, shillings and
MAT

pence. An extract from a column is reprinted here.

£ s. d. £ s. d. £ s. d. £ s. d.
Ale, English . . doz. 0 12 6 Girard. . . . . . 14s 0d—11s 0d black . . . . . . . . . .,, 0 3 0 Colon.leaf 0 0 3
Colonial . gall. 0 6 0 Hall . . . . . . . 14s 0d—11s 0d Poultry, Turkies, ea. 0 4 3 ,, fig.. 0 1 6
WORKING

Arrow Root. . . . . lb. 0 1 6 Fruit, Oranges, doz. 0 2 0 Geese, . . ,, 0 3 3 ,, stlks.. 0 0 6

Beer, English, gall. 0 4 0 Lemons, ,, 0 1 0 Fowls, pair 0 1 9 Negrohd.. 0 3 6
Colonial ,, 0 2 0 Apples, ” 0 2 0 Ducks, ea. 0 1 6 Segars,Col.box 0 7 0
Biscuit. . . . per cwt. 0 16 0 Peaches, ,, 0 0 3 Rice . . . . . . . . . . . lb. 0 0 3 Hav. ,, 0 15 0
Blankets. Col. p.pr 0 10 0 Grain, Wheat, Bush. 0 4 0 Salt, colonial . . . cwt 0 5 0 Chinsura 0 10 0
Blue. . . . . . . . . . . lb. 0 2 0 Maize, . . . ,, 0 2 6 Soap, colonial . . . .lb 0 0 4 12--- Manilla . 1 10 0
Bread, 2 lb loaf . . . . 0 0 3 --12- Barley . . . ,, 0 2 9 Spirits, Rum, . . .gall. 0 9 0 Snuff, colon . . . . . lb 0 7 0
Butter, fresh . . . . . . 0 1 0 Oats . . . . . ,, 0 0 01 Brandy . .,, 0 13 0 Vegetables,
salt. . . . . . . . 0 0 8 Meat, Beef, p.qtr.lb. 0 0 1 4--- Gin . . . . .,, 0 12 6 Potatoes,. . . p.cwt 0 3 6
Candles, moulds… lb 0 0 7 joint, ,, 0 0 2 1--2- Colon.,, 0 7 6 do old do. . 0 0 0
Dips. . . . . . 0 0 5 12--- salted ,, 0 0 3 Starch . . . . . . . . . lb. 0 2 6 Cabbages,. .p.doz. 0 1 6
ON

Cheese, English . lb 0 1 9 Mutton, carcasss ,, 0 0 2 Straw, Oat . . . . .load 0 12 6 Turnips, .p. bunch 0 0 2
Colonial . . 0 0 7 per joint ,, 0 0 3 Barley ,, 0 12 6 Carrots, do. 0 0 3
Cloth, Parramat. . yd 0 1 3 Pork, carcass ,, 0 0 4 Sugar, Loaf, per lb. 0 0 8 Beans, broad, pk. 0 0 0
Coffee, ground . . lb 0 1 6 per joint ,, 0 0 5 --12- Moist … ,, 0 0 3 --12- French, ,, 0 0 0
Eggs, per doz. . . . . . 0 2 6 salted . . ,, 0 0 4 Tallow, melted . cwt. 1 8 0 Onions . . . . . . . lb 0 0 1 --12-
FOCUS

Flax, New Zea . ton 22 0 0 Bacon . . .per lb. 0 0 7 Rough fat 1 3 4 Vinegar, colon.. gall. 0 3 0
Flour, 100lbs. fine 2nds. Hams . . .per lb. 0 0 9 Tea, Hyson . . . . . .lb 0 1 6 Wine, Port, p. doz. 35s—40s
Barker . . . . . . 14s 0d—11s 0d Veal, p.quarter ,, 0 0 3 Young Hyson ,, 0 2 6 Madeira ,, 35s—40s
Cooper . . . . . 14s 0d—11s 0d per joint ,, 0 0 4 Souchong . . . ,, 0 3 3 Sherry ,, 35s—40s
Darlg.Mill. . . 14s 6d—11s 6d Milk, per quart . . . . . 0 0 6 Pekoe. . . . . . . ,, 0 3 3 Claret ,, 10s—60s
Dixon . . . . . . 13s 0d—11s 0d Oil, sperm . . . . gall. 0 5 0 Gunpowder . . ,, 0 4 6 Cape . . . . gall. 0 4 6
Tobacco, Brazil… lb 0 2 4 Elder. . . . . ,, 0 5 6
 Chapter 3: Co n su mer arit hmet ic 103

2L EARNING ACTIVITIES

Work in groups to do this activity. You will need to know the following about Australia’s

THEMATICALLY
currency in 1831:
• Coins: the farthing ( 1--4- penny), the halfpenny ( 1--2- penny), the penny, the threepenny ‘bit’
(3 pence), the sixpenny coin (6 pence), the shilling (12 pence), the two shilling coin called
‘two bob’, and the crown (worth 2 shillings and 6 pence).
• Notes: the pound (called a ‘quid’), a 5 pound note (called a ‘fiver’), a 10 pound note
(called a ‘tenner’) and a 20 pound note. One pound was worth 20 shillings.
• Units: the gallon (gall, 1 gall = 4.8 L), the quart (qt, 1--4- gallon), the pound weight
(lb, 1 kg = 2.2 lb) and the bushel (1 bush = 8 gall).

1 Using the table on page 144 for prices at Sydney’s markets, work out the cost of each of the
following items and the total cost of the bill.
Item Cost Item Cost

ALLY
2 loaves of bread 2 bushels barley

FOCUS ON WORKING MA
1
---
2
gallon of Colonial beer 12 lb salted beef

IC
1 1
--- lb English cheese --- lb bacon

MATHEMAT
2 2

1
---
4
lb ground coffee 1 quart of milk
1 dozen eggs 3 ducks
6 lemons 2 lb Colonial soap
1
---
2
dozen oranges 1 1--2- lb loaf sugar

WORKING
2 Estimate the price of each of the above items if you bought them today. A bushel of barley
can be taken as 48 lb. Total the bill in dollars and cents.
3 Compare the prices of items in 1831 with prices today. How can you account for the big
change? Write down some factors that you would have to take into account (e.g. how much
people earned). (NOTE: When Australia changed to decimal currency in 1966, 1 pound
became $2.)
ON

4 The toll on the Sydney Harbour Bridge was raised to $3 in January 2002. It was sixpence
FOCUS

when the bridge was opened in 1932. Is this price rise reasonable over 70 years? What
things need to be taken into account (e.g. construction of the Sydney Harbour Tunnel)?
 104 Mathscape 9

5 Suppose you gained a pay rise of $20 per week. If inflation is 5%, what would be your real
increase in terms of how much more money you gained? If your new salary was $280 after
the pay rise, what is your total amount of available money after inflation?

8E
EMATICALLY

XTENSION ACTIVITIES

Discuss the following in class or use as a project idea.

1 Why is the ‘Cost of Living Index’ also called the ‘Consumer Price Index’? How is it
calculated in Australia today?
2 What is inflation? How is it measured? Inflation was low in Australia in 2001. How can
mathematics be used to help predict what might happen in 2004 and succeeding years?

E L ET’S COMMUNICATE

Using the price list on page 102 as a guide, write a letter to a student at school in 1831,
A LTL H

explaining why the cost of living is so much more in Sydney today. Explain what Sydney is
Y

now like, what technological progress has been made, what people earn and what they have to
spend compared to the early years of settlement. You might mention we went to decimal
I CA

currency in 1966!
M A TM

%R EFLECTING
A TI HNEG

Ask your grandparents, parents or guardian if they have experienced the effects of inflation on
their income. Why do governments need to control inflation? Why do you need to know about
it? How can inflation be measured mathematically?
K

1 Explain the difference between a salary budget noun 1. a plan showing how much money a
and a wage. person, organisation or country will earn and how it
2 What is an example of casually paid will be spent
work? –verb 2. to make such a plan: We budgeted on the
3 Explain the difference between gross and basis that we would both have full-time jobs next year.
–adjective 3. not costing much: budget clothes
net income.  Word family: budgetary adjective
4 Define taxable income for a new
mathematics dictionary. Why is it important to be able to manage your
5 Read the Macquarie Learners Dictionary income and spending?
entry for budget:
 Chapter 3: Co n su mer arit hmet ic 105

VIEW
1 Barry earns an annual salary of $50 600. a Calculate the commission paid to the
How much would Barry receive if he was agency on the sale of a house for
paid: $410 000.
a weekly? b fortnightly? b How much does the agent responsible
c monthly? for the sale receive?
2 A tradesman is paid $14.65 per hour for a 10 A factory worker is paid 15c for each
36-hour week. Calculate his weekly mouse trap put together on an assembly

CHAPTER RE
wage. line. How many mouse traps did the
3 A personal assistant receives a pay rise of worker assemble in a week when he was
6% on his annual salary of $38 850. Find paid $348?
his new monthly pay. 11 A doctor charges $21.80 for consultations
4 Catherine is a sales assistant at a petrol that last less than 10 minutes and $27.50
station. She works 40 hours each week for those that last longer than 10 minutes.
and is paid $12.25 per hour. Calculate her Yesterday she earned $1077.90. If 28
equivalent monthly pay. consultations lasted less than 10 minutes,
how many patients stayed for longer than
5 A bus driver is paid $13.95 per hour and
10 minutes?
his fortnightly wage is $1060.20. For how
many hours does he work each fortnight? 12 Stan earns $16.40 an hour for a 39-hour
week as a crane operator. Overtime is
6 Ximena’s annual salary increased from
paid at the time and a half rate for the first
$45 300 to $48 244.50. Calculate the
5 hours and at the double time rate
percentage increase in her salary.
thereafter. Calculate Stan’s total pay for a
7 Joseph is paid a retainer of $160 per week week when he works for 48 hours.
plus a commission of 4.5% on his weekly
13 Ricky worked for 35 hours last week at
sales. Calculate Joseph’s pay for a week
$11.35 per hour. He also worked 6 hours
when he sells goods to the value of
overtime, which was paid at the time and
$9560.
a half rate.
8 An encyclopaedia saleswoman is paid a a Calculate Ricky’s total pay for the
weekly retainer plus a commission of $22 week.
for each set of encyclopaedias that she b For how many hours would he need
sells. How much is she paid as a retainer to work at the normal rate in order to
if in one week she sold 9 sets of earn the same pay?
encyclopaedias and was paid $449?
14 Nadia’s annual salary is $23 660. She
9 To sell a property, the Second National took her annual 4 weeks holidays in
real estate agency charges a commission January and was paid 4 weeks normal pay
of 3.5% on the first $150 000 of the sale plus a holiday leave loading of 17 1--2- on
price and 2% on the remaining value. The this amount. How much did she receive
agent responsible for the sale receives altogether?
34% of the agency’s commission.

CHAPTER REVIEW
 106 Mathscape 9
CHAPTER RE

15 Mr Knight’s gross fortnightly pay is $107.80 for each of the fillings, $74
$1352. Each fortnight, his employer for the X-ray and 10% GST on the
deducts $266.37 in PAYG tax total bill. How much was she charged
instalments and he has other deductions altogether?
of $23.50 for superannuation and b Alex paid $90.75 for her weekly
$12.65 for health insurance. Calculate groceries, which included 10% GST.
Mr Knight’s net fortnightly pay. How much would the groceries have
16 Find the gross weekly pay of an cost without the GST?
employee with a net annual salary of 22 Sarah earns $450 per week after tax and
$35 600 and weekly deductions totalling rents a house with her sister. The women
$392.55. agree to contribute equally towards the
17 A painter earns an annual salary of payment of any gas, telephone or
$36 750 and is paid monthly. His annual electricity bills, which they estimate will
deductions are $7405 in PAYG tax and come to $480 per quarter, and the rent,
5% of his gross salary is paid into a which is $280 per week. So she can
superannuation fund. Find the painter’s manage her money wisely, Sarah has
VIEW

net monthly income. prepared a weekly budget.

18 Use the tax table on page 84 to calculate Budget item Budget amount
the amount of tax payable on each of
Rent
these annual salaries.
a $5750 b $18 430 Food $75
c $49 600 d $72 195 Bills
19 Jelena has an annual salary of $41 060. Clothes $30
She has allowable tax deductions
totalling $2825. Transport $35
a What is her taxable income? Entertainment $60
b How much tax is she required to pay? Savings
c Calculate Jelena’s average net
fortnightly pay. a How much should Sarah budget for
20 Eugene has a gross annual salary of rent each week?
$47 850. Each week, his employer takes b What should the weekly budget
out $226.50 in PAYG tax instalments. amount be for bills?
a Calculate the amount of tax that c How much is left over for savings?
Eugene is required to pay on his d What percentage of her income,
salary. correct to 1 decimal place, is spent on
b Is he entitled to a tax refund or does clothes?
he have to pay more tax? Justify your e If this information was shown on a
answer. sector graph, what would be the angle
21 a A dental patient was billed for two at the centre of the food sector?
fillings and an X-ray. She paid

CHAPTER REVIEW
 Chapter 3: Co n su mer arit hmet ic 107

VIEW
f Adjust this budget to allow for an 8% 28 The cost of a treadmill was reduced by
pay rise with one-third of the extra 15% and sold for $632.40. What was the
money being spent on entertainment original price?
and the rest of the money going 29 Ian saved $34.80 when he purchased
towards savings. 4 new tyres for his car at a tyre sale. If he
23 Determine the best buy by finding the paid $109.30 per tyre, find the percentage
cost of 200 g of the item. discount. Answer correct to 1 decimal

CHAPTER RE
A 20 g for $3.60 B 25 g for $4.25 place.
C 40 g for $8 D 50 g for $9.50 30 Ian bought 4 new tyres for his car and
24 Determine the best buy by finding the received a 7 1--2- % discount on the total cost.
cost of 1 mL of the item. If Ian paid $429.20 altogether, find how
A 55 mL for $3.41
much he saved.
B 70 mL for $4.13
C 90 mL for $5.49 31 An antiques dealer purchased a rare book
D 115 mL for $6.67 for $3500 and sold it a week later, making
25 A calculator wholesaler gives retail stores a profit of 15%. Find the sale price of the
a discount of 5% on orders of more than book.
50 units. How much would a store owner 32 Aislinn bought a chest of drawers for
save if he purchased 80 calculators, given $380 and sold it 2 years later for $247.
that the normal wholesale price is Calculate the percentage loss.
$16.40? 33 a Shane sold his car for $10 200, which
26 A music store offered 20% off the cost of represented a loss of 40% on the
all classical CDs. Johann purchased original price. How much did
5 CDs with a marked price of $22. Shane pay for the car?
How much did he pay altogether? b A retailer bought a chandelier from a
27 a A kitchen appliance was discounted wholesaler and sold it in her lighting
from $42 to $36.75. What was the store for $899, making a profit of
percentage discount? 45%. Calculate the wholesale price of
b The retail price of a reclining chair the chandelier.
was reduced by $152 to $798. What
was the percentage discount?

CHAPTER REVIEW