Question

An employee has an annual salary of $51,300. They receive $2,830 in health insurance and $4,600 in paid time off per year. They drive their personal vehicle for work which costs them $600 per month, but the company reimburses them $0.54 per mile for the total work miles driven. If the employee drives 36,000 miles for work for the year, what will be their total employment compensation?
a.
$70,740
b.
$70,970
c.
$77,570
d.
$78,170

Answer 1

Compute each part:

- Salary: $51,300
- Health insurance: $2,830
- Paid time off: $4,600
- Vehicle cost: $600/month × 12 = $7,200/year
- Reimbursement: $0.54/mile × 36,000 miles = $19,440
- Net benefit from driving = reimbursement − actual cost = $19,440 − $7,200 = $12,240

Total employment compensation = 51,300 + 2,830 + 4,600 + 12,240 = $70,970

Answer: b. $70,970