Base Pay Plus Bonus on Excess Perfect Units

Steps:

• Calculate base pay: 40 hours × $4/hour =$160.
• Determine perfect units: 880 total units - 40 faulty = 840 perfect.
• Find excess perfect units: 840 - 500 expected = 340.
• Compute bonus: 340 ÷ 20 = 17 groups × $1 =$17.
• Add total pay: $160 +$17 = $177.

Why A is correct:

• The bonus formula rewards $1 per 20 perfect units exceeding 500, excluding faulty ones as they are scrapped and not counted.

Why the others are wrong:

• B: Overcounts bonus by treating 1 extra unit as another $2 or misapplying excess.
• C: Applies bonus to total units (880 - 500 = 380 ÷ 20 × $1 =$19 + $160 +$23 overtime error).
• D: Ignores faulty units entirely, basing bonus on 880 - 500 = 380 ÷ 20 × $1 =$19 + $160 +$25 miscalculation.

Final answer: A