For some salaried employees, such as sales reps, you may wish to represent a commission or bonus paid in addition to the base salary. LivePlan can build commission or bonus payments based on a percentage of your sales.
Base salary and commission should be shown as separate entries. For each employee or group of employees who will be paid a commission or bonus, you will need to create two entries in your forecast: one Personnel entry representing the base salary, and one entry representing the commission/bonus.
Creating the base salary entry
Please see Entering Personnel for instructions on how to create the salary entry. You can create an entry for an individual employee or a group of employees. Many commissioned employees are considered direct labor employees - if you're not sure which option to use for this entry, see What is the difference between direct labor and regular labor?
In the example below, we've forecast a salary for group of five sales reps. The monthly salary and employee-related expenses are now shown in the Personnel table:
Creating the commission entry
Once you've added the base salary for the employee or group of employees, you can add their commission or bonuses. To do this you'll add another Personnel item, set it as a Direct Cost and then calculated it based on a percentage of overall sales or a specific revenue stream:
- Click the Add Personnel button and give the commission/bonus item a name:
- Next, choose the Direct Labor option and specify On-staff employee to add employee-related expenses to the bonus:
- Click Next to proceed to the commission amount:
- Select whether to calculate the commission or bonus off of a specific revenue stream or overall revenue and set it's percentage:
- Click Create & Exit to create the forecast entry and return to the Personnel page:
In the example above, we've added a 6% bonus (on overall Revenue) for our Sales Representatives, and in the Personnel table, that will look like this:
More on personnel:
- What is the difference between direct labor and regular labor?
- Changing the Burden Rate for employee-related expenses
- Understanding head count details for personnel
- How can I represent part-time personnel in my forecast?
- How do I locate my salaries and wages in the Profit and Loss?