Enter your base salary, total compensation, and additional compensation details into the calculator to determine your compensation ratio.
Compensation Ratio Calculation Formula
The following formula is used to calculate the compensation ratio from your base salary and total compensation.
Compensation Ratio = Total Compensation / Base Salary
Variables:
- Compensation Ratio is the ratio of total compensation to base salary.
- Total Compensation is the sum of base salary, bonuses, equity, and other compensation.
- Base Salary is the fixed annual salary before any additional compensation.
To calculate the compensation ratio, divide the total compensation by the base salary.
What is Compensation Ratio Calculation?
Compensation ratio calculation refers to the process of determining the ratio of total compensation to base salary. This involves understanding your base salary, total compensation, and any additional compensation components. Proper compensation ratio calculation ensures fair and competitive compensation structures within organizations.
How to Calculate Compensation Ratio?
The following steps outline how to calculate the compensation ratio using the given formula.
- First, determine your base salary and total compensation.
- Next, include any additional compensation components such as bonuses and equity.
- Use the formula from above: Compensation Ratio = Total Compensation / Base Salary.
- Finally, calculate the compensation ratio by plugging in the values.
- After inserting the variables and calculating the result, check your answer with the calculator above.
Example Problem:
Use the following variables as an example problem to test your knowledge.
Base Salary = $80,