Example 1: Payment Term Begins Before and Ends After Contract Term

In this example, the payment term begins before the contract term, and the payment term ends after the contract term.

Contract Settings

This table lists the parameters that determine the daily pay rate in this example:

Parameter	Value
Contract Salary	60,000
Work Days	147
Paid Holidays	25
Total Paid Days (work days + paid holidays)	172
Daily Pay Rate (contract salary / total paid days)	348.83721 per day

This table lists the parameters that determine the pay period rates in this example:

Parameter	Contract Term	Payment Term
Dates	September 1 to April 30	July 1 to June 30
Number of monthly pay periods	8	12
Pay Period Rates	Contract regular earnings (not adjusted for holidays) 60,000 over 8 months = 7,500 per month	Amount paid: 60,000 over 12 months = 5,000 per month

Prorate Method

In the following table, worked earnings are calculated using the Prorate (pay period rate) method.

This diagram shows worked earnings calculations using the per period rate Prorate method.

Actual Method

In the following table, worked earnings are calculated using the Actual (daily rate) method:

This diagram shows worked earnings calculations using the daily rate Actual method.