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I am looking for conversion based on daily values to annualized values. However, these are NOT for returns, but for amounts.

For returns based conversions, the standard formula to use is well-known:

Annual returns = (1+Daily returns)^365 – 1

My requirement is a bit different. I need to pay my staff based on the daily sale value (which is not really returns) - hence the question.

Consider the following values of sales made on a daily basis for each business day of the October month:

Date    Sale($)
01-Oct-20   395.54
02-Oct-20   388.35
05-Oct-20   393.19
06-Oct-20   389.71
07-Oct-20   394.28
08-Oct-20   396.27
09-Oct-20   399.7
12-Oct-20   406.64
13-Oct-20   403.51
14-Oct-20   399.5
15-Oct-20   399
16-Oct-20   400.65
19-Oct-20   400.09
20-Oct-20   401.41
21-Oct-20   400.15
22-Oct-20   400.24
23-Oct-20   401.04
26-Oct-20   395.01
27-Oct-20   393.27
28-Oct-20   383.76
29-Oct-20   383.62
30-Oct-20   377.59

I pay my staff 3% commission ANNUALLY for the sale they make. The calculations for 3% are ANNUAL, but payments need to be made on a MONTHLY basis.

So essentially, the questions are:

(1) For the above case of October month DAILY sales figures, how do I arrive at an ANNUAL value on which this 3% payment can be applied?

(2) Since the answer to (1) will be ANNUAL value, how can it be converted to MONTHLY payment amount (for Oct month)?

Please help!

Aquaholic
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  • So if you pay them $3%$ on monthly sale every month end, that should translate to $3%$ of the annual sale. Would that not work? – Math Lover Nov 18 '20 at 13:26
  • Thanks @MathLover. I am looking for a model with daily pro-rated portion of the annual fee, if you can provide some insights please. Or to put it another way - sale commission is ANNUAL-basis. So daily values need to be annualized to arrive at an annual value. Then payments are monthly, so the average ANNUAL value need to be converted for that particular month. – Aquaholic Nov 18 '20 at 13:36

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