An employee terminated with 3 workdays remaining in a month; annual salary $24,000; paid semimonthly. What is the regular compensation due this employee for the final pay period?

• A. $782.61
• B. $723.07
• C. $800.00
• D. $869.57

Answer: (B)

When an employee is terminated partway through a pay period, the regular amount due for the final period is prorated to reflect only the days actually worked during that period.

For semimonthly pay, the full period amount is the annual salary divided by 24: 24,000 / 24 = 1,000. To account for days not worked in the final month, use a daily rate based on typical workdays per year (commonly 260): 24,000 / 260 = 92.31 per day (rounded to cents).

If 3 workdays remain unworked in the final month, the value of those days is 3 × 92.31 = 276.93. Subtracting this from the full semimonthly amount gives the regular compensation due for the final pay period: 1,000 − 276.93 = 723.07.

So the final pay period regular compensation is about 723.07.