An employee’s basic salary is Rs. 45,000 per month. The company gives a dearness allowance (DA) of 8% of basic, a house rent allowance (HRA) of 15% of basic, and a performance bonus equal to 6% of his gross salary (basic + DA + HRA). What is his total monthly gross remuneration?
Answer
Rs. 58,671
The correct answer is Rs. 58,671 — Add bonus to gross: 55,350 + 3,321 = 58,671.
Step-by-step solution
- Calculate DA: 0.08 × 45,000 = 3,600.
- Calculate HRA: 0.15 × 45,000 = 6,750.
- Find gross before bonus: 45,000 + 3,600 + 6,750 = 55,350.
- Calculate bonus: 0.06 × 55,350 = 3,321.
- Add bonus to gross: 55,350 + 3,321 = 58,671.
Common mistake: Adding bonus before computing gross salary
Concept tested: Gross salary calculation with allowances
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