1 year = 365 days

= 12 months
= 52 weeks
100
= 26 fortnights

95
1 month is Fortnightly = per annum means
75 not 4 weeks! weekly ´ 2. per year.

25

0 I BUDGETING
A budget is a financial plan for the future which estimates future expenses and income and
calculates a projected surplus or deficit of money. A budget enables a person to plan for holidays
or other expensive activities like weddings etc.
There are five main steps to follow in setting up a budget.
1 Decide whether the budget will be weekly, fortnightly, monthly or annual.
2 Estimate income from all possible sources.
3 Estimate all expenses. Plan for emergencies.
4 Calculate the surplus, hopefully, or the deficit.
5 Revise the budget if there is a deficit or if you want a greater surplus. Remember fixed expenses
like rent, insurance etc cannot be altered, but expenses like food, clothing, and entertainment,
can be altered.
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B ALLOWANCES AND LOADINGS

Most employers expect their workers to work a certain number of hours per day and hours worked in excess of
these are paid at an overtime rate.
The two main overtime rates are time and a half and double time.
Employees who are required to work under difficult, unpleasant or dangerous conditions are often paid an
allowance that is above the normal rate of pay.
Some examples include an allowance for cleaning toilets, working in confined spaces, working in hot
conditions, dealing with toxic substances, etc.
Other allowances that are paid are for uniform, drycleaning of uniform, travelling, meals, tools and so on.
An annual leave loading is paid to employees taking their annual holidays and is added to their pay.

“Time and a half ”

means the hourly rate is
1_w Q times greater.

C COMMISSION
Real estate agents and car salespersons are examples of people paid by commission. A commission
is a percentage of the total cost of the goods sold paid to the salesperson. The more sold the greater
the income.
Remember that to
change to percentage
we multiply by 100%.

D BONUS AND HOLIDAY LOADING

Employees sometimes get extra payments in addition to their normal wages.

A bonus is a gift/incentive for employees who have worked hard over a period of time.
Employers use a bonus to encourage the employees to work even harder!
Holiday loading is an increase in an employee’s pay whilst on holidays. The holiday loading
is a fixed percentage of the employees normal pay. It is usually at a rate of 17¡¡¡
 %.

PIECEWORK AND ROYALTIES

People employed making items may be paid for each item produced. This is piecework. An author
will receive a percentage of the selling price of books they have written. This is called a royalty.
These are two ways of receiving income.

Net income = gross income ¡ all deductions.

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Wed Feb 09 15:23:31 2000