Bonus calculation question (real situation need help)

Question

You will earn bonus of $10,000 tied to company's revenue target of $5m. Payout will start at 90% target achievement with a 50% incentive payout, growing linearly with achievement, with the ability to overachieve.

Question - The company achieved revenue of $6m. What should be my bonus? Please explain your logic.

Answer 1

Assuming that 100% of the bonus is paid at 100% target achievement, that would be 50% better than the payout from a 90% target achievement. If the linear progression continues without hitting a cap to $6M (20% over target), the expected bonus would be 100% better or $20,000.