Calculation of weekly income
Periodical payments are normally made either weekly (or in
some multiple of weeks), or monthly (or in some multiple of
months). The key question is – how many payments are made, or are
due to be made, in the course of a whole year? The most common
situations are:
- 52 times a year (weekly) - unchanged
- 26 times a year (fortnightly) - divide by 2
- 13 times a year (four-weekly) - divide by 4
- 12 times a year (monthly) - multiply by 12 and divide by 52
- 6 times a year (bi-monthly) - multiply by 6 and divide by 52
- 4 times a year (quarterly, every three months) - multiply by 4 and divide by 52
- Once a year (annually, every twelve months) - divide by 52
The appropriate conversion to a weekly amount is shown after the dash.
The program does this automatically if other than 'Week' is picked in
the associated combo box. Normal monetary rounding is applied where the
intermediate result is not an exact multiple of a penny.
Where payments of income are made in periods of other than weeks or
months, they are converted to a weekly amount by dividing by the number
of days in the period and multiplying by 7. So, for example, a payment
that is made every 20 days would be converted by the factor 7/20.
Payments in this form are rare.
In practice most forms of income are paid weekly, four-weekly or
monthly; some kinds of investment income are paid quarterly. Monthly
payments are normally made on a fixed day of the month, while the
payment day of four-weekly payments will vary over the course of the
year.