The table below shows the typical hours worked by employees at a company. A new employee is offered an annual salary of [tex]\$37{,}000[/tex]. Hourly employees get paid [tex]\$14[/tex] per hour but get [tex]\$21[/tex] per hour for each hour over 40 hours. Should the new employee choose the salaried or hourly pay?

\begin{tabular}{|c|c|c|c|c|c|c|}
\hline Sun. & Mon. & Tues. & Wed. & Thurs. & Fri. & Sat. \\
\hline 0 & 8.5 & 9.5 & 7.5 & 8 & 8.5 & 4 \\
\hline
\end{tabular}

A. Hourly. An hourly employee would make [tex]\$35{,}672[/tex] per year.
B. Hourly. An hourly employee would make [tex]\$50{,}232[/tex] per year.
C. Salaried. The annual salary for a salaried employee is more than the hourly pay.
D. Salaried. The annual salary for a salaried employee is less than the hourly pay.



Answer :

To determine whether the new employee should choose the salaried or hourly pay, let's break down the given information and perform the necessary calculations step-by-step.

First, let's summarize the given hourly work schedule:
- Sunday: 0 hours
- Monday: 8.5 hours
- Tuesday: 9.5 hours
- Wednesday: 7.5 hours
- Thursday: 8 hours
- Friday: 8.5 hours
- Saturday: 4 hours

### Step 1: Calculate the total weekly hours worked
We sum the hours worked each day of the week:
[tex]\[ 0 + 8.5 + 9.5 + 7.5 + 8 + 8.5 + 4 = 46 \text{ hours} \][/tex]

### Step 2: Calculate the regular and overtime hours
- Regular hours: Up to 40 hours per week are considered regular hours.
[tex]\[ \text{Regular hours} = \min(40, 46) = 40 \text{ hours} \][/tex]
- Overtime hours: Hours worked beyond 40 are considered overtime.
[tex]\[ \text{Overtime hours} = \max(0, 46 - 40) = 6 \text{ hours} \][/tex]

### Step 3: Calculate weekly earnings for hourly employees
- Regular hourly rate: [tex]$14 per hour - Overtime hourly rate: $[/tex]21 per hour

Now, compute the weekly earnings:
[tex]\[ \text{Weekly earnings} = (\text{Regular hours} \times \text{Regular rate}) + (\text{Overtime hours} \times \text{Overtime rate}) \][/tex]
[tex]\[ \text{Weekly earnings} = (40 \times 14) + (6 \times 21) \][/tex]
[tex]\[ \text{Weekly earnings} = 560 + 126 = 686 \text{ dollars} \][/tex]

### Step 4: Calculate annual earnings for hourly employees
To find the yearly earnings, we multiply the weekly earnings by the number of weeks in a year (52 weeks):
[tex]\[ \text{Annual hourly earnings} = 686 \times 52 = 35672 \text{ dollars} \][/tex]

### Step 5: Compare with the annual salaried wage
The annual salary provided is [tex]$37,000. ### Conclusion - Hourly annual earnings: $[/tex]35,672
- Salaried annual earnings: $37,000

The salaried annual earnings are more than the hourly annual earnings. Therefore, considering the monetary aspect, the employee should choose the salaried pay.

The correct answer is:
Salaried. The annual salary for a salaried employee is more than the hourly pay.