Gross pay is the total amount of money a person earns before any deductions, such as taxes or insurance, are made. In simple terms, it's the full earnings from work before anything is taken out. Calculating your gross pay helps you know what you should receive based on your hourly rate or salary and the hours you worked.
- Find out the hourly rate. In Norman's case, it's $13.15 per hour.
- Determine the total hours worked. Norman worked 18 hours.
- Multiply the hourly rate by the total hours to get the gross pay.
Understanding gross pay is crucial for budgeting and financial planning. It sets the stage for computing your net pay, which is what you take home after deductions like taxes. Being aware of your gross pay ensures there are no surprises on your paycheck and empowers you to better manage your finances.