MODULE 8: COMPUTATION OF GROSS PROFIT

PRE-TEST

Let us see what you already know about forecasting revenues and costs.
Answer the questions below.

1. False
2. True
3. True
4. True
5. True
6. False
7. False
8. True
9. True
10. True
11. False
12. True
13. True
14. True
15. True

Activity 1

Read and understand the given problem.

In the example that I gave, answer the following questions:

1. How much does Rodrigo earned profit?

Rodrigo earned a profit of 180,000

2. Is it good to engage in a business? Yes or No?

Yes, it is good to engage in a business since businesses play a huge part in culture and society
in general. They not only take up the foremost amount of time in most people's lives, but they
also offer assistance create developments and make important technological advancements.

3. What do you think of Rodrigo’s business? Is it good for a beginner?

Yes, Rodrigo’s business is good for a beginner or start ups.

Activity 1.2: Answer the given problem.
1. Annie bought one dozen smartphones for P200,000.00 with a discount of 5%. She sold half
dozen at a price of P18,000.00 per unit. However, a new model of smartphone became
available in the market, so she sold the remaining half dozen @ P12,000.00 each unit.
What was her profit or loss?
Compute the following requirements:
a. Gross profit rate
b. Operating profit margin rate
c. Net profit margin rate
d. Return on Investment

Answers:

a. Gross Profit Rate

Gross Profit
Net Sales PHP – 180,000
Cost of sales - 190,000
Gross Profit (Loss) PHP (-10,000)

Gross Profit (Loss) PHP (-10,000)

Gross Profit (Loss) Rate = Gross Profit (Loss)

Net Sales

= -10,000
180,000
= 0.06%

b. Operating Profit Margin Rate

Less Operating Expenses = 0
Operating Profit Margin = PHP 10,000

OPM = Nest Sales – Operating Expenses

= 180,000 – 0
= 180,000

Operating Profit Margin Rate = Operating Profit Margin

Net Sale

= 180,000 = 1% Operating Profit Margin Rate

180,000

c. Net Profit Margin

Net Profit Margin Rate = Net Profit

Net Sale
= -10,000
180,000

= - 0,06%
d. Return of Investments

Return of Investments = ___Net Income___

Average Total Assets

= 180,000
90,000

= - 2 % Return Investment

Now ask yourself the following questions:

1. Is creativity present in the operation of ordinary small businesses along the streets and
highways and in your neighborhood? Why do you say so?

Yes, because an entrepreneur should be creative, especially ordinary small businesses along
the streets and highways and in the neighborhood. Creativity is present.

Will you consider the daily business practices of the small owner within the concept of
entrepreneurship? Why?
Yes, I will consider the daily practices of the small owner within the concept of entrepreneurship
since all entrepreneur started from small businesses, they just need to work hard and take risk to
grow their business.

Assessment

How did you understand the lessons that you have studied in this module?
Answer the following questions.

1. False
2. True
3. True
4. True
5. True
6. False
7. False
8. True
9. True
10. True
11. False
12. True
13. True
14. True
 15. True

MODULE 9: BUSINESS IMPLEMENTATION

PRE-TEST

Before starting with this module, let us see what you already know about implementing a business plan. Answer the
questions below.
Instruction: Read the statements carefully then Write True if the statement is correct & write False if you
think the answer is not correct. Write your answer on the space provided before the number

1. True
2. True
3. True
4. True
5. False
6. True
7. True
8. True
9. True
10. True
11. True
12. False
13. False
14.True
15. True

Activity 1.1
Identify the services offered by the following offices to you as an entrepreneur.

1. Department of Trade and Industry (DTI) - This is to make sure that no other business or
organization has the same name as yours. It is also to ensure you can go on with establishing
your business without any legal hassles along the way.

2. Securities and Exchange Commission (SEC) – Is a Federal agency responsible for

administering federal securities laws that protect investors and also ensures that securities
markets are fair and honest.

3. Bureau of Internal Revenue (BIR) – Tasked to asses and collect all national internal revenue
taxes, fees, and charges, and to enforce all forfeitures, penalties, and fines connected therewith.

4. Mayor’s Office – For getting the license to operate in the city or municipality payment of your
local business.
5. Social Security System (SSS) – Provides death, funeral, maternity leave, sickness and
involuntary separation/ unemployment benefits.
 6. Philhealth – Provide health insurance coverage and ensure affordable and accessible health
care services for all Filipinos.

7. Pag-ibig Fund - Responsible for the administration of the national savings program and
affordable shelter.

Activity 1.2

Answer the following questions:

1. As an entrepreneur, is it important to know the services offered by the offices mentioned above?

Yes, it is important to know the services that are offered by the offices.

2. If your answer is YES, in what way that their services becomes important to you?

It is important to know the services offered by them since entrepreneurs are expected to comply
with laws that protect the rights of employees against unfair labor practices .

3. If your answer is NO, what makes their services unnecessary to you?

If my answer is no, then it is because you can finance and support your business alone without
the help offered by the offices.

4. Do you think a business can last without availing the services of the said offices? Why? Or why not?

Yes, businesses can last long without availing the services of the said offices. A business can last
if they have great vision, great financial management, and great people.
Activity 2: Create your own business Plan.

With no less than 10 pages following the format:

- Executive summary
- Marketing plan
- Management plan
- Financial Plan

Assessment

Now that you are finished accomplishing the module, let us check what you have learned. Answer the
questions given below by encircling the letter of the correct answer.

1. B
2. A
 3. C
4. C
5. D
6. C
7. D
8. A
9. B
10. D
11. B
12. D
13. D
14. A
15. B

MODULE 10: BOOKKEEPING

PRE-TEST: Multiple Choice: Identify the correct answer among the given choices. In your answer
sheet, write the letter only.

1. B
2. C
3. B
4. A
5. D
6. C
7. D
8. B
9. C
10. A
11. D
12. D
13. A
14. A
15. C
 Let us begin!

Mr. Denver Ambrose is a retired public school teacher. He started his laundry business in June
2018. He used all of his savings to start a “coin-operated laundry” business. He named it Alpha Laundry
Systems (ALS). The following are business transactions for the month of June 2018, the first month of
business operation:

1. June 1, 2018 - Mr. A invested P 200,000 cash in his newly opened Alpha Laundry System business.

Your Journal Entry:

GENERAL JOURNAL

POST.
DATE PARTICULAR REF. DEBIT CREDIT
1 June 1 Mr. A Investment 200,000 200,000
2 Mr. A Hired Former Classmate 10,000 10,000

3 To record the initial Capital investment of Mr. A.

2. June 2, 2018 - Mr. A hired his former classmate Doree Dy to be the laundry operator of ALS for a fixed
monthly salary of P10,000. The operator will be paid every quencina.

3. On June 5, 2018 – Alpha Laundry Systems purchased laundry equipment for cash, P150,000.

Your Journal Entry:

GENERAL JOURNAL PAGE 1

POST.
DATE PARTICULARS REF. DEBIT CREDIT
4 June 5 Alpha Laundry Purchased Laundry Equipment 150,000
5 Sed Laundry Equipment 150,000

6 To record the acquisition of Laundry equipment

4. On June 6, 2018 – Alpha Laundry Systems paid cash in advance for the 1 year insurance coverage of
laundry equipment for the whole year amounting to P6,000.
Monthly insurance expense will be recognized for each month end report.
Your Journal Entry:
GENERAL JOURNAL PAGE 1

POST.
DATE PARTICULARS REF. DEBIT CREDIT
7 June 6 Alpha Laundry System Paid 6,000
8 Cash in Advance 6,000
9 To record the prepaid Insurance for the Laundry equipment

5. On June 7, 2018 – Alpha Laundry Systems bought supplies for laundry amounting to P10,000. The
supplies bought are laundry consumables such detergent powder, soap bar and fabric softener.
Monthly inventory will be conducted to determine unused supplies and will be recognized for each
month end report.

Your Journal Entry:

GENERAL JOURNAL PAGE 1

POST.
DATE PARTICULARS REF. DEBIT CREDIT
10 June 7 Alpha Laundry System Bought Supplies For The Laundry 10,000
11 Supplies 10,000
To record the acquisition of laundry consumables
12

6. On June 15, 2018 – Alpha Laundry Systems paid P4,750 cash for salary of laundry operator.

Your Journal Entry:

GENERAL JOURNAL PAGE 1

POST.
DATE PARTICULARS REF. DEBIT CREDIT
13 June 15 Alpha Laundry System Paid Cash For Salary Of Laundry 4,750
Operator
14 4,750
To record the payment of Laundry operator’s salary
15

7. On June 16, 2018 – Alpha Laundry Systems received P25,000 cash for laundry services rendered to
MZ. Hotel.

Your Journal Entry:

GENERAL JOURNAL PAGE 1

POST.
DATE PARTICULARS REF. DEBIT CREDIT
16 June 16 Alpha Laundry System Received Cash For Laundry 25,000
Services
17 Labor 25,000
To record the payment received from MZ Hotel.
18

8. On June 17, 2018 – Alpha Laundry Systems rendered service to Argon Hotel amounting to P45,000.
Argon promised to pay on June 20 of the same year.

Your Journal Entry:

GENERAL JOURNAL PAGE 1

POST.
 DATE PARTICULARS REF. DEBIT CREDIT
19 June 17 Alpha Laundry System Rendered Service To Argon Hotel 45,000
20 Payment services 45,000
To record the service rendered to Argon Hotel
21

9. On June 18, 2018, Alpha Laundry Systems purchase office supplies from Ku Enterprises amounting to
P2,000 on account. ALS will pay it on June 25 of the same year.

Your Journal Entry:

GENERAL JOURNAL PAGE 1

POST.
DATE PARTICULARS REF. DEBIT CREDIT
22 June 18 Alpha Laundry System Purchase Office Supplies from 2,000
Ku Enterprises
23 2,000
To record the acquisition of Office
24 Supplies on account from Ku Enterprises

10. On June 20, 2018, Alpha Laundry Systems collected payment of Argon Hotel.

Your Journal Entry:

GENERAL JOURNAL PAGE 1

POST.
DATE PARTICULARS REF. DEBIT CREDIT
25 June 20 Collected of payment Argon Hotel 45,000
26 45,000

27 To record the full payment from Argon Hotel

11. On June 25, 2018, Alpha Laundry Systems paid in full the amount owed to Ku Enterprises.

Your Journal Entry:

GENERAL JOURNAL PAGE 1

POST.
DATE PARTICULARS REF. DEBIT CREDIT
28 June 25 Alpha Laundry System Pain In Full Owed To Ku 2,000
Enterprises
29 2,000
 To record the full payment of account to Ku
Enterprises
30

12. On June 27, 2018, Alpha Laundry Systems paid electric bill for the month amounting to P1,000 in cash.
The payment is charged to Utility expense account.

Your Journal Entry:

GENERAL JOURNAL PAGE 1

POST.
DATE PARTICULARS REF. DEBIT CREDIT
31 June 27 Alpha Laundry System Paid Electric Bill for The Month 1,000
32 1,000
To record the payment Electricity for the month
33

13. On June 30, 2018, Alpha Laundry Systems paid a month’s transportation expense amounting to P
1,300.

Your Journal Entry:

GENERAL JOURNAL PAGE 1

POST.
DATE PARTICULARS REF. DEBIT CREDIT
34 June 30 Alpha Laundry System Paid a Monthly Transportation 1,300
Expenses
35 1,300
To record the payment of transportation for the
36 month.

14. On June 30, 2018, Alpha Laundry Systems paid P5,000 cash for salary of laundry operator.

Your Journal Entry:

GENERAL JOURNAL PAGE 1

POST.
DATE PARTICULARS REF. DEBIT CREDIT
37 June 30 Alpha Laundry System Paid Cash Salary of Laundry 5,000
Operator
38 5,00

39 To record the payment Laundry operator’s salary.

15. On June 30, 2018, Alpha Laundry Systems paid P7,500 cash for the month’s rent of laundry space.

Your Journal Entry:

GENERAL JOURNAL PAGE 1

POST.
DATE PARTICULARS REF. DEBIT CREDIT
40 June 30 Alpha Laundry System Paid Cash for The Month’s Rent 7,500
Laundry spale
41 7,500
To record the payment of rent for Laundry space.
42

Activity 2 : Posting journal entries to the General Ledger using T - accounts.

T – accounts for all ledger accounts group according to the five major accounts.

200,000 2,00,000
 ASSETS LIABILITIES

200,000 200,000
25,00 25,000
2,000 2,000

6,00
6,000 10,000
10,00

OWNER’S EQUITY

2,000 150,000 150,000

2,000

0
200,0
2,00
 200,000
200,000

1,000 1,000
4,750 4,750
5,000 5,000

6,000 6,000
 ACTIVITY 3

Answer the following fill in blank questions:

1. Chronological manner
2. Journal
3. General Ledger
4. Balance sheet
5. Income statement
6. Book of account
7. Sales report
8. Cash flow projection
9. Account recievable
10. Cash outflow

ASSESSMENT

1. C
2. B
3. B
4. B
5. D
6. C
7. B
8C
9. A
10. C

Quarter Challenge 2

1. C
2. B
3. D
4. C
5. D
6. C
7. A
8. D
9. A
10. B
11. A
12. D
13. B
14. C
15. A
16. A
17. C
18. C
19. A
20. B
21. D
22. C
23. C
24. B
25. D
26. B
27. A
28. C
29. A
30. A
31. B
32. C
33. B
34. C
35. C
36. B
37. C
38. A
39. D
40. D
41. C
42. A
43. D
44. C
45. C
46. B
47. B
48. A
49. C
50. D