Page 89 - Accountancy_F5

Example 3.1
Mr. Peter is employed by Kwetu Social Club on part-time basis at a rate of TZS
40,000 per hour. During the year ending 30 June 2024, he worked for an average
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of 20 hours per month.
You are required to calculate Peter’s:
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(i) Basic pay for the month of January 2024.
(ii) Quarterly basic pay for the quarter ending September 2023.
(iii) Annual basic pay for the year ending 30 June 2024.
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Solution 3.1
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(i) Computation of monthly basic pay for the month of January 2024:
Basic pay = Rate per hour normal working hours worked
Rate per hour = TZS 40,000
Number of hours worked in a month = 20 hours.
Basic pay = TZS 40,000 x 20 hours
Peter’s basic pay for January 2024 = TZS 800,000
(ii) Computation of quarterly basic pay in the year ending 30 June 2024.
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Quarterly Basic pay = monthly Basic pay x 3
From (i) above, monthly Basic pay = TZS 800,000
Therefore, quarterly Basic pay = TZS 800,000 x 3
Peter’s quarterly basic pay in the year ending 30th June, 2024 = TZS 2,400,000

(iii) Computation of basic annual pay for the year ending 30 June 2024
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Basic annual pay = monthly Basic pay x 12 months
From (i) above monthly Basic pay = TZS 800,000
Therefore, annual Basic pay = TZS 800,000 x 12
Peter’s annual basic pay for the year ending 30th June 2024 = TZS 9,600,000

Exercise: 3.1

1. Mr. Rizwan is employed by Mlapakolo Company Ltd. as an assistant accountant
since 1 July 2022. He holds a Bachelor of Accountancy from a recognised Institute
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of Accountancy and Business Studies. Salary scales in Mlapakolo Company Limited
are as follows:
Education qualification Salary scale Basic salary payable in TZS
Certificate ASS 1.1 470,000

Diploma ASS 2.1 637,000
Bachelor Degree ASS 3.1 1,072,000

Student’s Book Form Five
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