NS 5.1.2: Consumer Arithmetic Students learn about calculating earnings for various time periods from different sources, including: Wage  Salary  Commission  Piecework Overtime  Bonuses  holiday loadings  interest on investments calculating income earned in casual and part-time jobs, considering agreed rates and special rates for Sundays and public holidays calculating weekly, fortnightly, monthly and yearly incomes calculating net earnings considering deductions such as taxation and superannuation calculating simple interest using I = PRT where I is the interest, P the principal, R the annual interest rate as a decimal and T the number of time periods applying the simple interest formula to problems related to investing money at simple interest rates calculating compound interest for 2 or 3 years by repeated multiplication using a calculator eg a rate of 5% per annum leads to repeated multiplication by 1.05 calculating compound interest on investments using a table calculating and comparing the cost of purchasing goods using: Cash  credit card  lay-by deferred payment  buying on terms  loans calculating a ‘best buy’

Wages and salaries People who work usually earn a wage or a salary. People who engage in manual or mechanical work (shop assistants, tradespeople, factory workers, etc.) usually earn a wage. People engaged in office or professional work (engineers, teachers, the police, bank employees, etc.) usually earn a salary. A wage is income determined by the number of hours an employee works for a fixed hourly rate and is usually paid weekly. Wage earners have the capacity to earn more income by working extra hours (overtime). A salary is income determined by a fixed annual amount which is then paid to the employee in weekly, fortnightly or monthly amounts. Salary earners do not have the capacity to earn extra income through overtime, but can attract other benefits, such as a company car, bonus payments or an expense account.

Ways of earning money Method of payment ExplanationGood pointsBad pointsExample Salary Wages Casual Piece work Commission Sick pay etc A fixed amount of pay each month or fortnight Non-permanent employment. Pay based on the number of hours worked. Person is paid a fixed amount for each “piece” of work. Paid a percentage of the price of the goods sold. Permanent employment. Pay based on the number of hours worked. Paid overtime Sick pay etc Flexible Work harder means you get paid more No sick pay etc Work harder means you get paid more No overtime No sick pay etc Groundsman Teacher Take away Shop assistant Cloths maker Fruit picker Sales rep.

Time 1 Year= 12 months = 52 weeks = 26 fortnights = 365 days = 366 days in a leap year Months January February March April May June

Example 1 Laura earns $38,135 per annum. Stephanie earns $3170 per month. Tracey earns $1467 per fortnight. Alison earns $733 per week. Who earns the most and by how much? Laura Stephanie Tracey Alison  Tracey earns the most, by $ × 12 = 1467 × 26 = 733 × 52 = $38,135 per annum. $38,040 per annum. $38,142 per annum $38,116 per annum.

Example 2 Bianca earns $8  35 an hour. How much will she earn if she worked 9am to 4:30pm on Monday and 10:15am to 6:20 on Friday? Monday Friday = $130  12 Be very careful with time calculations where you don’t have whole hours! Total Pay 7½ hours 8:05 hours 15:35 hours / 60 8  35 × / 60 7½ × 8  35 = 8 5 / 60 × 8  35 = Total = 62   50 $130  13

Today’s work Yesterday’s work Exercise 5-01 Page 186 → 187 Q1 → 4 Q5 a, c, e & g Q7 & 8