Memorandum Regarding New Procedure for Determining Commissions



Memorandum Regarding New Procedure for Determining Commissions :




This Memorandum should be typed in the official letter-head of the company.


TO :


FROM :


DATE :


SUBJECT : New Procedure for Determining Commissions


To determine the commissions on a product quoted as a landed-project price, our new procedure is to deduct freight and duty to arrive at FOB factory price. This price then is the basis for the standard commission on foreign sales.


The following illustrates this computation.


Foreign sale pri ….Rs. 190 000


Less freight ….Rs. 525


Less duty ….Rs. 475


= FOB factory price ….Rs.150 000


The standard commission rate will apply to the Rs.150 000 FOB factory price not the foreign sale price.


We hope this explanation and example will clarify any questions regarding commissions on foreign sales.


Regards,




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Memorandum Regarding New Procedure for Determining Commissions
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