To calculate the 70/30 split compensation plan, multiply the annual salary by 0.7 (representing the 70% fixed salary), then divide the result by the number of months to determine the monthly pay.

## 70/30 Compensation Plan Calculator

A **70/30 compensation plan** is a widely-used structure in which 70% of a person’s compensation comes from base salary and 30% comes from variable or performance-based earnings, such as sales commissions. This plan is common in sales roles where a portion of earnings is fixed, while the remaining depends on performance metrics like sales or targets.

**Formula:**

The formula to calculate monthly pay under this plan is:

**MP = (0.7 × S) / n**

Where:

**MP**is the monthly pay from the base salary,**S**is the annual salary,**n**is the number of months (typically 12 for a yearly salary).

For example, if a person’s annual salary is $100,000, the 70% base salary is **$70,000**, which is divided into monthly installments.

**Solved Calculations:**

**Example 1:**

Calculation |
Instructions |
---|---|

Given: Annual Salary = $120,000, n = 12 |
Start with the annual salary and number of months. |

MP = (0.7 × 120,000) / 12 | Multiply the salary by 0.7. |

MP = 84,000 / 12 | Divide by the number of months. |

MP = $7,000 |
The monthly pay is $7,000. |

**Answer:** The monthly base pay under the 70/30 plan is **$7,000**.

**Example 2:**

Calculation |
Instructions |
---|---|

Given: Annual Salary = $80,000, n = 12 |
Start with the annual salary and number of months. |

MP = (0.7 × 80,000) / 12 | Multiply the salary by 0.7. |

MP = 56,000 / 12 | Divide by the number of months. |

MP = $4,666.67 |
The monthly pay is $4,666.67. |

**Answer:** The monthly base pay under the 70/30 plan is **$4,666.67**.