The table below shows the typical hours worked by employees at a company. A salaried employee makes [tex]$\$67,000$[/tex] per year. Hourly employees get paid [tex]$\[tex]$25$[/tex][/tex] per hour, but get [tex]$\$37.50$[/tex] per hour for each hour over 40 hours.
\begin{tabular}{|c|c|c|c|c|c|c|}
\hline Sun. & Mon. & Tues. & Wed. & Thurs. & Fri. & Sat. \\
\hline 0 & 10 & 8 & 8 & 7 & 6.5 & 4.5 \\
\hline
\end{tabular}

Which of the payment options would you recommend to a new employee?

A. Either one. Hourly and salaried employees earn the same amount per week.
B. Hourly pay. Hourly employees make more per week than salaried employees.
C. Salaried pay. Salaried employees make more per week than hourly employees.
D. There is not enough information given to compare weekly earnings.

Please select the best answer from the choices provided.



Answer :

To determine which payment option is more advantageous, we need to compare the weekly earnings of an hourly employee versus a salaried employee based on the given data.

First, let's summarize the hours worked each day in a week for an hourly employee:

- Sunday: 0 hours
- Monday: 10 hours
- Tuesday: 8 hours
- Wednesday: 8 hours
- Thursday: 7 hours
- Friday: 6.5 hours
- Saturday: 4.5 hours

Now, adding these hours gives us the total hours worked in the week:

[tex]\[ 0 + 10 + 8 + 8 + 7 + 6.5 + 4.5 = 44 \text{ hours} \][/tex]

Next, we determine the breakdown of these 44 hours into regular and overtime hours:
- Regular hours: The maximum number of regular hours is 40.
- Overtime hours: Any hours worked beyond 40 hours.

From the total of 44 hours:
- Regular hours = 40 hours
- Overtime hours = 44 - 40 = 4 hours

Calculating the weekly pay for an hourly employee:
- Regular hourly rate: [tex]$25 per hour for up to 40 hours. - Overtime rate: $[/tex]37.50 per hour for hours beyond 40.

The weekly earnings for an hourly employee are calculated as follows:
[tex]\[ \text{Weekly pay (hourly)} = (40 \text{ hours} \times \$25) + (4 \text{ hours} \times \$37.50) = \$1000 + \$150 = \$1150 \][/tex]

Now, calculate the weekly earnings for a salaried employee:
- A salaried employee makes [tex]$67,000 per year. - There are 52 weeks in a year, so the weekly salary is: \[ \text{Weekly pay (salaried)} = \frac{\$[/tex]67,000}{52} \approx \[tex]$1288.46 \] Comparing the two: - Weekly pay (hourly): $[/tex]1150
- Weekly pay (salaried): $1288.46

It is clear that salaried employees make more per week than hourly employees based on the given data.

Therefore, the best recommendation for a new employee would be:
[tex]\[ \text{c. Salaried pay. Salaried employees make more per week than hourly employees.} \][/tex]