This is a very basic calculation revolving around percentages. Just take the sale price, multiply it by the commission percentage, and divide it by 100. An example calculation: a blue widget is sold for $70
. The salesperson works on a commission — they get 14%
out of every transaction, which amounts to $9.80
.
So the formula is:
commission amount = sale price × commission percentage / 100
.
So now you know how to calculate commission. Now that you have this figure, there's a problem with who will cover this cost — usually, it's the selling party (whoever hired the salesperson to do the job). To calculate their revenue, we need to calculate the percentage decrease:
real revenue = sale price - sale price × commission percentage / 100
. In our example, it's$70 - $70 × 14 / 100 = $70 - $9.80 = $60.20
.
It's not very common, but sometimes it's the buyer who pays for the salesperson's remuneration. In those cases, we need the percentage increase formula:
price with commission = base price + base price × commission percentage / 100
. In our example, it's $70 + $70 × 14 / 100 = $70 + $9.80 = $79.80
.