How do I set up a formula to calculate a bonus?

[Dabeave]

What function can I use to set up a formula to calculate a bonus?

 

[JE McGimpsey]

Well, you could use EXP(), but that probably wouldn't fit with your
company's policy...

There are an almost infinite number of ways to calculate "a bonus",
which can be done in an almost infinite number of ways using XL
functions.

So to narrow down that infinity a bit, how would you calculate it by
hand?

 

[Gord Dibben]

Not enough detail here to give a reasonable answer.

Can you post an example of your requirements?

Maybe something like =LOOKUP(A1,{0,10000,20000,30000},{0,0.01,0.015,0.02})*A1

Where <10000 give no bonus, 10000-19999 gives 10%, 20000-29999 gives 15%

Anything over 30000 gives 20%


Gord Dibben MS Excel MVP

 

[Tyro]

How do YOU calculate a bonus. Then perhaps someone could tell you how do it
in Excel.

Tyro

 

[build]

If your my boss.
Bonus=CurrentSalary^CurrentSalary should do the trick.
cheers

 

[JLatham]

I'll echo the same line others have: how are you calculating any bonus given
now? If you can tell us how it's done now, we can probably come up with a
formula to do it in Excel.

If you're looking to come up with some way to determine how to give people a
bonus, then that is almost business dependent. There are so many ways to
give bonuses that it's a Hurculean task to just list them all, but some would
be:

flat % above a (sales/production) point.
series of escalating % values at various (sales/production) points.
some absolute values simply based on reaching certain goals
some absolute values based on performance evaluations
one-time bonus value, as at Christmas.
apportioned bonus from a pool built up from part of the profit on a project
and the % apportioned based on performance evaluations.

It's largely 'industry' driven: you have to look at how the bonus money is
to be obtained in the first place and that means you have to look at the cost
and sell price of the product or service, see how much is actual profit and
then determine how much of that profit you're willing to provide to the
employees as a bonus. In the future, or even now, the anticipated bonus on
products/services should be factored in during the pricing of the
product/service so that it becomes a type of indirect 'overhead' vs having to
come directly out of the raw profit.