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Question:
An experienced salesperson arranged an employment contract calling for a 70/30 split of any commissions received. The salesperson completed a sale for $650,000 representing both the buyer and seller. The escrow instructions called for a 5% fee paid to the broker. How much did the salesperson receive from their broker?
A
$22,750.
explanation
The total fee paid to the broker is 5% of the sales price.
$650,000 x 0.05 = $32,500
In this example, the experienced salesperson represented both the buyer and the seller and earned 70% of the $32,500 fee.
$32,500 x 0.7 = $22,750
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