Michigan Mortuary Science Practice Exam

If a commission greater than 5% of the contract price is charged, what percentage of the remaining balance should be paid to the person entitled?

1. 50%

2. 75%

3. 100%

4. 25%

The correct answer is: 100%

In the context of commissions and contract pricing, when a commission greater than 5% is charged, the standard practice is that the person entitled receives 100% of the remaining balance. This practice is generally established to ensure fairness in compensation, especially in situations where higher commissions might otherwise reduce the amount payable to the entitled party. This principle reflects a common understanding in contractual agreements where the intent is to guarantee that individuals or entities who are owed compensation are not adversely affected merely by higher upfront costs or commissions. Thus, if a higher commission is taken from the total contract price, the remaining balance should rightfully be paid in full to the party entitled to those funds. This approach helps maintain trust and transparency in financial transactions. Other options suggest varying percentages that do not align with these contractual norms, indicating a misunderstanding of standard compensation practices in such scenarios.