11

BUSINESS
MATHEMATICS
Quarter 3- Module 1:

Department of Education ● Republic of the Philippines

Business Mathematics –
Grade 12 Alternative
Delivery Mode Module 1
First Edition, 2020

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 11

BUSINESS
MATHEMATICS
Quarter 3- Module 1:
Fractions, Decimals, Percent
Ratio and Proportion
Buying and Selling

This instructional material was collaboratively developed and

reviewed by educators from public and private schools, colleges, and
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Department of Education ● Republic of the Philippines

 TABLE OF CONTENTS
What This Module is About …………………………………..…………………............i
What I Need to Know ………………………………………..……………............ii
General Instruction ……………………………………………...………………ii
Icons of this Module ……………………………………………………....……..iii
What I Know …………………………………………………………......iv
Lesson 1:
Conversion of Fraction to Decimal, Percent and Vice Versa
What’s In ………………………………….………………………….1
What’s New …………………………………….………………………..1
What is It ……………………………………….…………………….2
What’s More ………………………………………….…………………..4
What I have Learned …………………………………………….…………….5
What I can do ……………………………………………………………...6
Additional Activity ………………………………………………………….……..7
Lesson 2:
Ratio and Proportion
What’s In ………………………………….………………………….8
What’s New …………………………………….………………………..8
What is It ……………………………………….…………………….9
What’s More ………………………………………….………………….14
What I have Learned …………………………………………….……………15
What I can do ……………………………………………………………..16
Additional Activity ………………………………………………………….……16
Lesson 3:
Buying and Selling
What’s In ………………………………………………………………17
What’s New ……………………………………………………………….17
What is It ………………………………………………………………18
What’s More ……………………………………………………………….22
What I have Learned ……………………………………………………………22
What I can do ……………………………………………………………….23
Additional Activity ………………………………………………………………23
Assessment…………………………………………………………………………...24
What This Module is About

This module is intended for students who take up Accountancy, Business and
Management Academic Track in Senior High School, specifically for grade 11
students. This module will help you comprehend how Business Mathematics is used
in different business transactions. It will let you realize how this subject is frequently
used in your daily life. This module aims to develop your critical thinking and allow
you to practice your skills in solving real world problems through applications of prior
knowledge and acquiring new information. You will learn different strategies in
solving problems by enhancing your analytical skills, critical thinking skills, and boost
your decision-making skills in different business scenarios. The module will likewise
guide you if you choose to continue higher education or build your own business.
Included in this module are basics of Mathematics like fractions, decimals,
percentage, ratio and proportion. You will learn through this module the concept of
“Buying and Selling,” which is one of the most essential topics that will be certainly
used in college and in different business activities. All the parts will guide you in the
lesson so you have to accomplish each part to effectively learn in this module. You
are expected to read with comprehension, perform every task included in each
lesson, and answer all the required assessments.
You will be able to learn while having fun in this module. You will enhance
your logical thinking and improve your reading comprehension. Be sure to read and
answer all the activities to do well in this subject.

The Lessons included in this module are:

Lesson 1- Fractions, Decimals, and Percent

Lesson 2- Ratio and Proportion

Lesson 3.1- Buying and Selling

i
 What I Need to Know

After reading this module, you are expected to:

1. express Fractions into decimal and percent and vice versa;
2. solve problems involving fractions, decimals, and percent;
3. identify the different kinds of proportions and write examples of real-life
situations;
4. solve Problems involving direct, inverse, and partitive proportion;
5. differentiate Mark-on, Mark down and Mark-up obtain Mark-on, Mark-down,
and Mark-up given price of a product;
6. differentiate mark-up from margins;
7. describe how gross margins is used in sales; and
8. compute single trade discounts and discount series.

General Instruction:

1. Read every detail in this module with comprehension.

2. Answer the activities diligently and intelligently.
3. Be mindful of the deadlines set. Submit activities and exercises on time.
4. Be responsible of this module, do not crumple or write anything.
5. Be honest at all times in answering the activities and assessments in this
module.

ii
Icons of this Module:

What I need to This part contains learning objectives

Know that are set for you to learn as you go
along the module.

What I Know This is an assessment as to your level of

knowledge to the subject matter at hand,
meant specifically to gauge previous
knowledge.

What’s In This part connects previous lesson with

that of the new lesson.

What’s New This part is an introduction of the new

lesson through various activities before it
is presented to you.

What is It This part provides the discussion of the

activity conducted to deepen your
understanding of the concepts.

What’s More This part provides activities that serve as

follow-up or enrichment to master the
learning competencies.

What I have This part assesse you on how far you

Learned have mastered the competencies.

What I can Do This provides tasks for you to

demonstrate the knowledge and skills

iii
 you gained and apply it real life
experiences.

What I Know

Choose the best answer from the options provided in each number.
8
1. What is in percent?
35
a) 22.14% b) 22.86% c) 23.28% d) 23.50%
14
2. What is express in decimal?
50
a) 0.38 b) 0.48 c) 0.58 d) 0.28
3. Express 3.75 into Fraction.
3 1 3 1
a) 3 b) 3 c) 4 d) 4
4 4 4 4
4. 105% can be expressed in fraction as.
5 1 1 1
a) 2 b) 1 c) 1 d) 5
100 25 20 100
5. What is 3.75 into percent?
a) 0.375% b) 375% c) 0.0375% d) 3750%
1
6. Convert 12 % into decimal.
2
a) 0.125 b) 12.5 c) 1.25 d) 0.0125
7. A poll taken in a certain subdivision on the operation of the Bataan Nuclear
Power Plant showed 235 citizens voting “No” and 47 citizens voting “Yes”.
What is the ratio of the No votes against the Yes votes?
a) 5:1 b) 2:5 c) 1:6 d) 5:3
8. In a certain City, 2,000 families owned cars, 3,000 families owned jeepneys,
and 500 do not own any automobile. What is the ratio among them?
a) 5:1:6 b) 2:5:1 c) 1:6:2 d) 4:6:1
9. Linda uses 2 eggs for every 3 cups of flour in her cupcakes. If she uses a
dozen eggs, how many cups of flour will she need?
a) 16 b) 26 c) 18 d) 40
10. A recipe has 10 cups of flour for every 4 cups of sugar. If you want to make a
recipe using 8 cups of flour, how much sugar does one use?

iv
 a) 1.5 cups b) 1.3 cups c) 3.2 cups d) 4.2 cups
2
11. A syrup is made by dissolving 2 cups of sugar in cups of boiling water. How
3
many cups of sugar should be used for 2 cups of boiling water?
a) 6 cups b) 4.3 cups c) 5.2 cups d) 6.5 cups

12. A school buys a gallon of juice for 50 kids. How many gallons do they need
for 75 kids?
a) 1 ½ gallons b) 2.3 gallons c) 4.3 gallons d) 3.5 gallons
13. An Acer laptop costs ₱22,700.00. The selling price is ₱33,650.00. What is
the rate of markup based on cost?
a) 47.78% b) 47.87% c) 48.24% d) 48.54%
14. What is the markdown rate if the cellphone is sold to ₱8,560.00 from
₱12,950.00 original price?
a) 51% b) 53% c) 55% d) 57%
15. The cost of a pair of shoes is ₱850.00; it is sold at 25% markup based on
cost. What is its gross margin?
a) ₱212.50 b) ₱1,062.50 c) ₱312.60 d) ₱1,052.12

v
vi
 Lesson FRACTIONS, DECIMALS,
AND PERCENTS
1

What’s In

Fraction is part of a whole. It has 2 main parts, numerator and denominator. It

is separated by a vinculum which means division. Numerator tells how many parts
are taken from the whole, while the denominator tells the number of parts a whole is
divided into. When the numerator is lesser than the denominator, the fraction is
called proper fraction. If the numerator is greater than or equal to the denominator it
is called improper fraction. Improper fraction can be transformed into a mixed
number. You just have to divide the numerator by its denominator; the remainder will
be placed over the divisor or the denominator. Fractions can be converted into
decimals, and percent or the other way. These three are often used in our daily life
activities. Fraction is used in measuring mixtures. Decimals can be associated with
money. Percent is oftentimes used in business transactions.

What’s New

Activity1. Matching Fractions, Decimals and Percentages

Match the numbers below by drawing a line that will connect to its equivalent value.

0.8
0.8
0.6
0.6 2/5
2/5

12.5%
12.5% 1/100
1/100

80%
80% 1/400
1/400

0.0025
0.0025 10%
10%

1%
1% 75/100
75/100

0.40
0.40 3/5
3/5

0.75
0.75 0.1
0.1
1/8
1/8

1
 What is It

Converting Fraction to Decimal

You already learned that vinculum or the bar that separates the numerator
and the denominator indicates division. Therefore, in changing fraction to decimal we
simply divide the numerator by the denominator. Where, the denominator is the
divisor and the numerator is the dividend.

Example: (1)
7
Convert into decimal. We divide 7 ÷ 9:
9
7
7 ÷ 9 = 0.7777 Therefore, = 0.7777
9

(2) (3)
2 2
= 2 ÷ 7 = 0. 2857 2) = 2 ÷ 5 = 0. 4
7 5

Converting Fraction to Percent

To convert fractions to percent, we change the fraction into decimal (by
performing division) and move the decimal point two places to the right; then affix the
percent symbol (%).
Examples:
1
=1 ÷8=0.125=12. 5 %
8
7
=7÷ 12=0.5833=58 . 33 % ( round off )
12
3
=3 ÷16=0.18 .75=18. 75 %
16

Converting Decimal to Fraction

Decimals as parts of units divided into any power of 10. If a unit is divided into
10 parts, we have tenths; into 100 parts, we have hundredths; and so on. Therefore,
to change decimal to fraction, we convert a decimal to a fraction with a denominator
in multiples of 10 (10, 100, 1000, etc.) and reduce the said fraction to lowest terms.

2
Example:
25 0.25 has two decimal places. Our denominator has to
1. 0.25 =
100 have two zeros; hence, 100. We divide 25 by 25 (GCF or
25÷ 25 Greatest Common Factor) and we get 1 and we divide
100÷ 25 1
100 by 25 and get 4; hence the answer is
1 4
=
4

275 0.275 has 3 decimal places. Our denominator should have

2. 0.275 = 275
1000 3 zeros; hence, 1,000. Reducing to the lowest term,
275÷ 25 1000
1000 ÷ 25 we divide 275 by 25 (GCF) to arrive at 11; we divide 1,000
11 11
= by 25 to arrive at 40; hence, our answer is
40 40

374 0.0374 has 4 decimal places. Our denominator should

3. 0.0374 =
10 000 have 4 zeros; hence, 10 000. The only common
374 ÷2 denominator or the only number that can exactly divide
10 000÷ 2 374 and 10 000 is 2. If we divide by 2, we reduce our
187 187
= fractions to .
5 000 5 000

Converting Decimal to Percent

To convert decimal to percent, we move the decimal point two places to the
right and affix the percent sign (%).

Examples:
1). 0.95 = 95% 3) 2.35 = 235% 5) 33.38 = 3338%
2). 0.0025 = .25% 4) 2 = 200% 6) 0.015 = 1.5%

Converting Percent to Decimal

To convert percent to decimal, we move the decimal point two places to the
left (as in dividing by 100) and we drop the percent (%). This is exactly the opposite
of what we did when we converted decimal to percent.
Examples:
65% = .65 3) 8% = 0.08 5) 33.46% = .3346
500% = 5 4) 656% = 6.56 6) 973.8% = 9.738

Converting Percent to Fraction

To convert percent to fraction, we first change percent to decimal, then
change the decimal to fraction and reduce to the lowest terms.

Examples:
24 6 875 35 7
1) 24% = 0.24 = = 5) 0.875%= 0.00875= = =
100 25 100,000 4,000 800
6 3
2) .6% = 0.006 = =
1000 500

3
 275 75 3
3) 275%= 2.75 = =2 =2
100 100 4

70 7
4) 70% = 0.70 = =
100 10
What’s More

Activity 1 Self- Assessment

Study the figures in column A and match its equivalent value in column B. Write
only the letter of the correct answer after each figure.

A B
1 13
1.) A.
2 2000

2.) 0.375 B. 0.0185

3.) 0.015 C. 0.0875

3 D. 50%
4.) 6 %
4
E. 150%
5.) 0.20
F. 7/8
6.) .08%
G. 3/8
7) 0.0065
27
H.
8) 0.875 400

3 I. 1/ 1250
9) 8 %
4
1
J.
37 5
10.)
2000
3
K.
200

Activity2. Your Turn

1. Thirty- five out of sixty students preferred to eat their lunch at school rather
than going home during lunch break. Express the numbers in decimal.
2. A lessor is asking for 2/5 of the value of the condominium unit Stephanie

4
 would be renting. How can this be written in percent form?

3. Tricia has travelled 0.75 km of the distance from her home to school. How
much has she travelled in fraction?
4. Only 0.60 of the students went to school during the first day of class. Express
in percent form.

5. Tristan got 7/8 of the questions correct in an employment examination for a

store manager. What is the decimal form of this fraction?

What I have Learned

Fractions can be converted to decimal by simply dividing numerator by its

denominator. Decimal can be transformed into fraction by putting denominators that
are multiple of 10,100,1000 and more. Always express the answer to the lowest
term. In converting decimal to percent, it can be done by moving two places to the
right and attach the percent symbol. Reversely, if percent will be changed to decimal,
move two places to the left and remove the percent symbol. Moreover, percent can
be changed to fraction by converting first to decimal and repeat the process on how
decimal is converted to fraction.

Reflective Question:
How can conversion of fraction, decimal, percent be used in business? Answer in
your own words based on what you have learned in this lesson.

5
 What I Can Do

Activity 3 My Budget Plan

Interview someone from your household who manages the monthly budgeting plan.
Do what are asked below and write your output in your activity notebook.

1. Show the monthly budget in your household.

2. Enumerate the expenses incurred on a monthly basis with the corresponding
amount.
3. Beside the amount, express the numbers into decimal, percentage, and in
fraction.
4. Show your monthly household budget expenses by drawing a pie chart
indicating the portion of each expense.
5. Mention the biggest and the smallest portion of your household expenses.

6
 Additional Activities

Complete the sentence below.

After doing the activities:
1. I noticed __________________________________________________

__________________________________________________________

__________________________________________________________
2. One question I have is _________________________________________

__________________________________________________________

__________________________________________________________
3. I’m not sure ________________________________________________

__________________________________________________________

__________________________________________________________
4. I realized ___________________________________________________

___________________________________________________________
___________________________________________________________

Lesson Ratio and Proportion

7
 2

What’s In

In the previous lesson you learned about fraction, decimal and percent in
which fractions can be converted into decimals, and percent or the other way
around. These three are often used in our daily life activities. Mostly, in measuring
mixtures we use fraction. Decimals can be associated with money, and oftentimes
we used percent in business transactions. Now we are going to learn about Ratio
and Proportion.

What’s New

Activity 1. Shade the number of boxes that corresponds to your answers.

1) 5 : 2 = x: 4

2) 12 : 1 = 24: x

3) x : 18 = 2: 6

2 x
4) = =?
4 2

27 x
5) = =?
6 2

8
 What is It

Ratios are generally used in business

in cases of partnership sharing profits and
losses. Assume that Zion, Xian, and Tristan
are partners sharing profits and losses in the
ratio of 1:2:3, respectively. If the partnership
incurred a net loss of ₱10 000.00 in a month,
the share each partner loses would be:

Zion = 1/6 x ₱10,000.00 = ₱1,667.00

Xian = 2/6 x ₱10,000.00 = ₱3,333.33
Tristan = 3/6 x ₱10,000.00 = ₱5,000.00
Total = 6/6 = ₱10,000.00

Take note: If we add the ratios, we get 6/6 or one, which means 1 whole. It is the
total of the shares if added giving us ₱10,000.00.

Ratio is the relation between two numbers or two magnitudes of the same kind. The
1
expressions 1:2 (read as “one is to two”), , 1 ÷ 2, indicate ratios. We are actually
2
comparing or showing the relationship between 1 and 2. When we say, for example,
that there are twice as many married employees as single employees, we mean that
the ratio of married to single employees is 2:1, where 2 represents married
employees and 1 represents single employees.

There are two ways in finding the ratio:

1. Division
If there are 20 boys and 30 girls, we find the ratio by dividing 20 boys by 30 girls and
reduce it to the lowest terms, that is,

20 2
= =2:3
30 3

We, then, say that the ratio of boys to girls is 2:3. On the other hand, the ratio of girls
30 3
to boys is = = 3 : 2 . We usually express ratios in terms of whole numbers.
20 2

9
 1. Comparing numerators of fractions with the same denominator
If we have a total of 100 T-shirts of 30 small-sized, 50 medium-sized, and 20 large-
sized T – shirts, we have
30 50 20
small medium large
100 100 100

To get the ratio, we compare the numerators; hence, we say that the ratio of small:
medium: large is 30:50:20 or 3:5:2. Adding all numerators should give us the
denominator. To check, 30 + 50 + 20 = 100. This is because the total of the parts
equals the whole. The notion of ratio is the same as the use of fractions in business.

Examples:

1. Chrisler and Dinnes are local election candidates. Albert received 2 500 total
votes while William received a total of 3 000 votes. What is the ratio of Albert’s
vote against William’s?

Chrisler: Dinnes = 2 500:3 000 = 25:30 = 5:6

Check: Chrisler’s votes + Dennis votes = 5 500

5 6
( 5 500) + (5 500) = 5 500 ( 5 +6 = 11, the denominator)
11 11
2 500 + 3 000 = 5 500
5 500 = 5 500

2. Aira, Zanthia, and Shakaine are partners. Their capital balances are
₱10000.00. ₱ 20 000.00, and ₱ 30 000, respectively. What is their capital
ratio?

Aira:Zanthea:Shakaine = 10 000:20 000:30 000= 1:2:3

1 3 1
3. A, B, C, and D divided a pie in such a way that A got ; B got , C got ,
5 10 10
2
and D got . Find the ratio in which the four divided the pie.
5

Solution:
Since the fractions are dissimilar, we first change them to similar fractions:

1 2 Therefore, the ratio in which the four divided the pie would
A= = be:
5 10
3 A:B:C:D = 2:3:1:4
B=
10
We use the numerators of similar fractions to get the ratio.
1
C=
10

10
 2 4
D= =
5 10

1. Mario has three times as many red marbles as his black marbles. If he has a
total of 24 marbles, how many are red and how many are black?

Red:Black = 3:11; therefore

3
Red = x 24 = 18 ( 3 and 1 are the numerators and 3 +1, which is 4, is the
4
denominator.)
1
Black = x 24 = 6
4

Total = 24

Proportion refers to the equality between ratios. The following are proportions:
9 81
1 : 2 = 8 : 16 (b) =
8 27
means

extreme
s
Our rule concerning proportions is that “the product of the means equals the product
of the extremes.”

In (a) above, 2 x 8 = 1 x 16
16 = 16
Applying the rule to (b) above, we cross-multiply the means and the extremes.
9 x 27 = 3 x 81
243 = 243

Cross multiplication is the same as multiplying the means and multiplying the
extremes. Expressing our fraction above as proportion, we have:
9 : 3 = 8 : 27

Where 3 and 81 are our means and 9 and 27 are our extremes. So, we multiply the
means 3 and 81 to obtain 243, and the extremes 9 and 27 to obtain 243.

3 Types of Proportion
1. Direct Proportion is a number directly proportionate to another when as one
value increases, so does the other.

11
 2. Indirect/ Inverse Proportion is a number indirectly proportionate to another
when as one value increases, the other decreases.

3. Partitive Proportion involves identifying parts of a whole based on a given

ratio of these parts.

Direct Proportion
The two values which are x and y are directly proportional to each other when
x and y will either increase or decrease together, such that when one decreases, the
other decreases or when one increases, the other increases as well.

For example, if three notebooks cost ₱15.00, how many notebooks can you buy with
₱60.00?

The number of the notebooks is directly proportional to the cost.

3 x
=
P 15.00 P 60.00

( 3 )( 60 ) 180
x= = = 12 notebooks
15 15

Inverse/ Indirect Proportion

Two values x and y are inversely proportional to each other such that if x
increases, y decreases or if x decreases, y increases.

For example, the relationship between time and installing a water pump.

It takes time to dig a well and install a water pump to supply the house with
water and the number of people needed to build it is an inverse proportion. The
greater number of people you have, the less time it takes. If it takes 3 people to do
the job in 1 month, it will take only 1/2 month if you have 6 people working. If you
double the number of workers, the time is halved If you triple the number of workers,
quick result will be achieved as the time becomes to a third.

Another example of inversely proportional quantities is the lengths and widths

of rectangles with the same area. As the length of one side doubles, the width has to
be halved so that the area stays the same. A 5 cm x 4 cm rectangle has an area of
20 square cm. If the 5-cm side becomes 10 cm (doubled), and the 4-cm side
becomes 2 cm (halved), 10 cm x 2 cm is still equal to 20 cm2.

In inverse proportions, the relationship between two numbers is such that the
product is a constant as in our example of the rectangle. When one side was

12
doubled, the other side was halved, but the product of the two remains the same.
The equation is of the form.

k
b= (where k is a constant)
a

20
Using our rectangle example y= , y is inversely proportional to x. Doubling x
x
causes y to halve. The product of x and y is always 20.
Partitive Proportion
When we talk about partitive proportion, we are talking about a whole which is
divided into parts. For example, when a partnership agreement stipulates an agreed
capitalization of ₱100, 000.00 and the partnership are to divide the said capitalization
in the ratio of 1:2:2, we are talking about partitive proportion and we get the
corresponding parts as follows assuming the partners are X, Y, Z, respectively,
contributing the capital:

1
X= x ₱ 100,000.00=₱ 20,000.00
5
2
Y = x ₱ 100,000.00=₱ 40,000.00
5
2
Z = x ₱ 100,000.00=₱ 40,000.00
5
= ₱ 100,000.00

Let us study the following additional examples using proportion:

1. A certain recipe of a baker uses a ratio of 1 egg for every 4 cups of flour. If he
or she uses a dozen eggs, how many cups of flour will he or she need?
Given: Ratio is 1 egg : 4 cups of flour
Find: 1 dozen eggs: x cups of flour

Solution 1: 4 = 12 : x (1)(x) = (4) (12)

X = 48 cups of flour

2. To produce perfume product, Zion uses two basic elements, A and B, and
combine them in the ratio of 2:7. If Zion has 91 parts of element B, how many
parts of element A should Zion use?

Given: Ratio of A:B = 2:7 Find: A

A 2
Solution: =
B 7
A 2
=
91 7
7A = ( 2 )(91)

13
 182
A= =26 parts
7

3. Kyrie and Andrie share profits of their partnership with ratio 2:3. If Kyrie’s
share in the profit last year was ₱30,000.00, how much was Andrie’s profit
share in their business?

Given: Kyrie : Andrie = 2 : 3

₱30,000.00: x = 2 : 3

Solution: 2x = (₱30,000.00) 3

90 , 000.00
x=
2
= ₱45,000.00

Check: Kyrie’s share + Andrie’s share = Total profit

₱30,000.00 + ₱ 45,000.00 = ₱75,000.00

2 3
Share in profit, using the 2 : 3 ratio = for Kyrie and for Andrie.
5 5
2
Share in the profit: Kyrie x ₱75,000.00 = ₱ 30,000.00
5
3
Andrie x ₱75,000.00 = ₱ 45,000.00
5

= ₱ 75,000.00

4. Jed and Ej decided that their profit and loss sharing ratio should be equal to
their initial capital investment. If Jed and Ej had capital balances of
₱200,000.00 and ₱100,000.00, respectively, how much profit would Ej get if
Jed got ₱50,000.00 for last year?

Given: Jed : Ej = ₱200,000.00 : ₱100,000.00 = 2:1

2: 1 = ₱50,000.00 : x

Solution: (1) ₱50,000.00 = 2 x

₱ 50,000.00
X=
2

X = ₱25,000.00

What’s More

14
Activity 1: Practice your skills:
Direction: Check the figures below; find the ratio of the area of the shaded
portion to that of the whole figure.
1. 2. 2.

3. 4.
Shade your
answer in
number 4.

3 x
=
4 20

5.
Shade your answer
in number 5.

5 8
=
10 x

What I have Learned

Ratios are generally used in business in cases of partnership sharing profits

and losses. Ratio is the relation between two numbers or two magnitudes of the
same kind while Proportion refers to the equality between ratios. There are 3 Types
of Proportion the Direct Proportion, Indirect/ Inverse Proportion and Partitive
Proportion.

Activity 3: Reflective Question:

15
 How does ratio and proportion help me as an ABM student?

What I Can Do

Activity 3: Bake A Cake

List down all the ingredients needed in baking. Write the applicable ratio and
proportion below.

Additional Activities

Complete the sentence below.

After doing the activities:
1. I noticed __________________________________________________

__________________________________________________________

__________________________________________________________

16
 2. One question I have is _________________________________________

__________________________________________________________

__________________________________________________________
3. I’m not sure ________________________________________________

__________________________________________________________

__________________________________________________________
4. I realized ___________________________________________________

___________________________________________________________

Lesson Buying and Selling

What’s In

Ratio is the relation between two numbers. It compares and shows

relationships between two number. Proportion refers to the equality between ratios.
The three types of proportions are: Direct, Indirect or Inverse proportions, and
Partitive proportions. Direct proportion means a number is directly proportionate to
another. Indirect happens when one value increases the other decreases. Partitive
proportion involves identifying parts of a whole. Ratio and proportions are used in
buying and selling. Setting up prices is one important step in business. Amounts
added to the cost is called markup. If the businessman wants to reduce the price, he
can apply markdown strategy. In determining the gross margin, you have to know
the sales and deduct the cost of the product.

What’s New

Activity1.

17
A. The Price is right.
Guess the correct price of the following merchandises. Select the prices in the box
below. Write the price below each merchandise.

₱23,900.00 ₱22,705.00 ₱11,998.00 ₱24,695.00

₱52,920 .00 ₱51,999.00 ₱44,459.15 ₱45,990.00

1. 2. 3. 4. 5. 6.

B. How much will the customer pay if the store offers 5% discount rate for the air
condition unit?
C. How much will the customer pay, if the seller gives 10% and 5% series of
discount for the television?

B. How much will the customer pay if the store offers 5% discount rate for the air
condition unit?
C. How much will the customer pay, if the seller gives 10% and 5% series of
discount for the television?

What is It

INITIAL MARKUP or MARK-ON:

- It is the amount added to cost to
arrive at the original selling price.
- Referred as margin.
- It is the difference between original
selling price and cost.

Illustration:
If a trader marked the merchandise, he/she bought for ₱100.00 to sell at
₱120.00, the ₱120.00 is the original selling price. So, ₱20.00 is the initial markup of
the merchandise sold.

18
ADDITIONAL MARKUP is the amount added to the original selling price to arrive at
a new selling price.

Illustration:
If a trader decides to increase his or her selling price from ₱120.00 to
₱150.00, as the new selling price, then, the ₱30.00 he or she added to the original
selling price of ₱120.00 is the additional markup.

Can you differentiate MARKUP and MARKDOWN?

MARK-UP is the amount that a seller of goods or services charges over and above
the total cost of delivering its product or service in order to make a desired profit.

Illustration:
If the trader marked the merchandise, he/she bought for ₱100.00 to sell at
₱120.00, the ₱120.00 is the original selling price and the ₱20.00 is the markup.

MARK DOWN refers to the deduction in the original selling price.

Illustration:
If the trader in our example reduces his/her original selling price from ₱120.00
to ₱115.00, the ₱5.00 reduction in selling price is termed markdown.

DIFFERENCE BETWEEN MARKUP AND MARGIN

MARGIN (GROSS MARGIN) refers as sales minus the cost of goods sold.

Illustration:
If a profit sells for ₱200.00 and costs ₱140.00 to manufacture, its gross
margin is ₱60.00. Stated as a percent, the margin is 30% (calculated as the margin
divided by sales). This is the markup based on sales or selling price.

MARGIN (MARKUP BASED ON SELLING PRICE)- is expressing the cost and the
markup in percent, wherein the selling price is used as the base. Here are the
formulas:
P
R=
B
Cost
Cost as %  of selling price=
Selling price

Markup
Markup as %  of selling price=
Selling price

19
Let’s Try:
Cost ………………….. ₱300 (______)
Markup ……………… ₱150 (______)
Selling Price ………. ₱450 (______)

Answer:
Cost ………………….. ₱300 66.67%
Markup ……………… ₱150 33.33%
Selling Price ………. ₱450 100%

MARKUP is the amount of the cost of a product that is increased in order to come up
with a selling price.

Illustration:
To use the preceding example, a markup of ₱60.00 to the ₱140.00 cost yield
the ₱200.00 selling price. Quantified as percentage, the markup percentage is
42.86% (calculated as the mark-up amount divided by the product cost). This is the
markup based on cost.

FORMULA ON MARKUP BASED ON COST:

To express the selling price and the markup in percent, the cost is used as the base:
P
R=
B
Selling price
Selling price as % of cost=
Cost
Mark−up
Mark−up as % of cost =
Cost
Let’s Try:
Cost ………………….. ₱300 (______)
Markup ……………… ₱150 (______)
Selling Price ………. …₱450 (______)

Answer:
Cost …………………..₱300 100%
Markup ……………… ₱150 50%
Selling Price ………. ₱450 150%

Therefore, the markup addresses the profit as it relates to cost price while margin is
addressing the profit as it relates to selling price.

Example:
Trader A wants a 30% markup based on selling price. Determine his or her
cost as a rate of selling price, and markup. Assume his or her cost is ₱200.00.

TRADE DISCOUNT it is a reduction from the list price granted to buyers. It could

20
either be a single discount or a series of discount.

NET INVOICE PRICE the price of the good/service after the discount has been
deducted.
Formulas:
Discount = List Price −Net
Invoice Price
SINGLE DISCOUNT: Net Invoice Price = List price -
P = BR (B = list price, R = discount rate, P = discount) Discount
Discount = List Price × Discount Rate NIP Rate = 100% - Discount

Example:
Compute the discount for an item with a list price of ₱1,250.00 subject to a 15%
discount. What is its net invoice price?
answer: ₱1,062.50

SERIES OF DISCOUNT:
A seller grants additional discounts other than the discount ordinarily given by
him/her.

Example:
Compute the discount and the net invoice price if an item at ₱1,250.00 is given a
10% and 5% discount.

SOLUTION FOR NIP:

NIP: (₱1,250.00(90%)(95%))=₱1,068.75
DISCOUNT: (₱1250.00(10%),(5%))=₱187.50

METHOD 1
1. The first discount rate must be multiplied by the list price.
2. Then, subtract the first discount from the list price.
3. To get the second discount, multiply the difference between the list price and
the first discount, and the second rate.
4. Then, deduct the second discount from the said difference to get the invoice
price.
Formula of Discount = First Discount + Second Discount
METHOD 2
1. Multiply the list price by the rate obtained and deduct the first discount rate
from 100%.
2. Multiply the first balance obtained by the second rate obtained and deduct the
second discount rate from 100%.
Formula of Discount = List Price – Net Invoice Price

METHOD 3

21
 1. Deduct the series of discounts individually from 100%.
2. Multiply the resulting products by themselves to give us the net invoice rate.
3. Deduct the NIP rate from 100% to get the single equivalent discount rate.
4. Discount = List Price x Single equivalent discount rate
5. Net invoice price = list price x NIP rate
6. Net invoice price = List price – Discount

What’s More

Activity 1 Practice your skills:

Direction: Draw an Arrow Up if you think the price is too low and needs to be
increased; Arrow down if you think the price is too high and needs to be lessened;
or an equal sign if the price is reasonable.
1. _____5 cans of sardines for a total of ₱85.00.
2. _____2 loaves of bread at ₱80.00.
3. _____10 packs of noodles at ₱50.00.
4. _____2 liters of mineral water for ₱22.00.
5. _____5 kilos of imported premium rice for ₱215.00.
6. _____1 kl of milkfish for ₱180.00.
7. _____3 kilos of Banana (lakatan) for ₱300.00.
8. _____½ kilo of brown sugar for ₱15.00.
9. _____2 kilos of cabbage for ₱120.00.
10. _____2 dozens of eggs for ₱96.00.
11. _____1 pair of men leather business shoes 3% discount for ₱7,000.00.
12. _____1 laptop acer at 3%, 2%, 1% series of discount for ₱25,000.00.
13. _____ Meal for 2 People, Mid-range Restaurant, Three-course at 6% discount
rate for ₱1,500.00.
14. _____1 combo meal in Xian Food Hauz at 2% discount rate for ₱147.00.
15. _____1 kilo of apple at 1.5% discount rate for ₱100.00.

What I have Learned

In every market, there are buyers and sellers. It is important to understand

how their relationship works and how it influences the markets. Buying and selling
are the heartbeat of an investor's life, and timing both these actions correctly is a

22
constant preoccupation. 

Reflective Question:
As a student how can I use my leanings in Mark-up, Mark-down, Margin, Trade and
series of discounts in my daily life activities?

What I Can Do

Activity4. Know the Prices

Interview at least 2 business owners near your locality on how they mark-up
or mark down their prices. Select at least 10 goods from each store and make a
comparison of both businesses. Write you analysis in the columns below. Ask these
2 chosen businessmen how they give discounts to their customers.
Goods Store A Store B

Additional Activities

Complete the sentence below.

After doing the activities:

1. I noticed ______________________________________________________
2. A question I have is ____________________________________________
3. I’m not sure ___________________________________________________

___________________________________________________________

23
4. I realized ______________________________________________________

Assessment

A. Change the following fractions to decimal. If not whole number, compute up to

three decimal places.
4
1)
9
11
2)
12
6
3)
6

B. Change the following decimals to fraction, renaming in the simplest terms.

1) 0.7 =
2) 0.35 =
3) 0.165 =
4) 0.245 =
5) 0.1235 =
C. Change the following fraction to percent. If not whole number, compute up to
two decimal places.
1
1) 6
3
1
2)
3
2
3)
5
D. Change the following percent to fraction. Express your answer into the lowest
term.
1) 28%
1
2) 5 %
2
3) 125%

E. Change the following decimal to percent.

24
 1) 0.75 4) 1.82
2) 0.200 5) 0.38
1
3) 3
4

F. Change the following percent to decimal.

3
1) 75% 4) 15 %
4
2) 5.64% 5) .675%
3) 300%

G. Problem Solving.
1. If you have one in eight chances of having green eyes, express this in:
a. Fraction
b. Decimal
c. Percent
2. Harry got 35 correct answers on their 50-item English test. What percent of
the test did he answer correctly?
3
3. Shanty ordered 6.2 square meters of cloth for her one bedroom and 3
4
square meters for another bedroom. If each square meters costs P44.00, how
much did she pay for the cloth in all?

4. An ABM student computed 85 x 0.25 quickly, the student takes one-fourth of

85 and gives an answer of 21.25. Is the student correct? Explain your answer.

5. In senior high school, 30% of the faculty teaches Math. If there are 30 Math
teachers, how many teachers are there in the school?
6. Among the total entrepreneurs in your locality, the ratio of those who finished
elementary education, high school education, and college education is 3:2:5.
If the total of entrepreneurs is 650, how many are elementary graduates?
High school graduates? College graduates?

7. Your father is a farmer; he wants to plant three times as many rows of

cassava and twice as many rows of corn as he has for peanuts. What will be
the ratio of cassava as to corn as to peanuts? If your father has a total of 264
rows available, how many rows will he have for each product?

8. A rich industrialist promised to donate ₱5.00 for every ₱1.00 in contribution

received for the victims of Mt. Pinatubo. If the total contribution received by
the civic organization is ₱12,368.00, how much will the industrialist give as
donation?

25
9. Ramon Montenegro and Rodrigo Aguilar agreed to go into a partnership.
Ramon invested ₱48,000.00 and Rodrigo invested ₱30,000.00. What part of
the total capital is that of Ramon’s? What part of the total capital is that of
Rodrigo’s? What is the ratio of their investment?

10. Arthur spends his salary of ₱3,000.00 for food, clothing, recreation, and
savings, which are in the ratio of 48:20:15:37, respectively. How much does
he spend for each category?

11. A new pair of earrings costs ₱5,500. The rate of markup based on the selling
price is 20%. What is the selling price and markup?
12. The cost of new pair of head set is ₱6,000. The selling price is ₱8,000. What
is the rate of markup based on cost?
13. Find the markdown rate if the Epson printer L120 was originally priced at
₱5,500 and was sold at ₱5,300.
14. After Valentine ’s Day, Shaun is considering to reduce the price of Toblerone.
Her original price is ₱500. If she wants to decrease its price to ₱450, what is
the markdown rate?
15. Store Y purchased 1 case of 1 soft drink at ₱420. They sell at ₱540 per case.
What is the mark up based on selling price?

26
 Answer Key
What I Know
1. B
2. D
3. A
4. C
5. B
6. A
7. A
8. D
9. C
10. C
11. A
12. A
13. C
14. A
15. A
Lesson 1: What’s New

27
Lesson 2: What’s More
Activity1 Activity 2
1. D 4. H 7. A 10. B 1) 58.33
2. G 5. J 8. F 2) 40%
3. K 6. I 9. C 3) ¾
4) 60%
5) 0.875

Lesson 2: What’s New

1) 10 boxes are to be shaded
2) 2 boxes are to be shaded
3) 6 boxes are to be shaded.
4) 1 box is to be shaded.
5) 9 boxes are to be shaded

What’s More
1) 1 :2
2) 1:2
3) 3:10
4) 15 boxes are to be shaded.
5) 1 box is to be shaded.

Lesson 3: What’s New

A.
1. ₱24,695.00
2. ₱11,998.00
3. ₱51,999.00
4. ₱45,990
5. ₱23,900
6. ₱52,920
B. ₱22,705.00
C. ₱44,459.15

What’s More
1. Equal 13. Arrow down
2. Arrow down 14. equal
3. Arrow Up 15. Arrow Up
4. Arrow Up
5. Arrow Up
6. Equal

28
7. Arrow down
8. Arrow Up
9. Equal
10. Arrow Up
11. Arrow down
12. Arrow up

Assessment
A. G. Problem Solving
1) 0.444 1.
2) 0.917 a) 1/8
3) 1 b) 0.125
B. c) 12.5%
1) 7/10 2. 70%
2) 7/20 3. P437.80
3) 33/200 4. Yes, because ¼ in decimal is .25
4) 49/200 5. 100
5) 247/2,000 6.
1) 633% 195 elementary graduates, 130 high
school graduates and 325 college
2) 33.33%
graduates
3) 40% 7. graduates
132 cassava rows, 88 cassava rows
and 44 peanut rows
C.
1) 7/25 8. ₱61,840.00
2) 11/200
3) 1 1/4 9. 8:5
10. Food 1200, clothing 500, recreation
D. 375 and saving 925
1) 75%
2) 20% 11.
3) 325% Selling Price=₱6,600, markup= 1,100
4) 182%
5) 38% 12. 33.33%
13. 3.77%
E. 14. 11.11%
1) 0.75 15. 22.22%
2) 0.0564
3) 3
4) 0.1575

29
 5) 0.00675

Reference:

Business Mathematics by Norma D. Lopez – Mariano, PhD 1 st ed., Published by

REX Books Store Manila, Philippines:856 Nicanor Reyes, Sr.
St. Tel. Nos. 736 – 05 – 67 . 735 – 13 - 64
Business Math Textbook, Authors: Brian Roy C. Lopez, Leah C. Martin - Lundag
and Keneth Adrian P. Dagal Editor Ian June L. Garces, PhD
Department of Education. GOP TEXTBOOK FUNDS

30
31
For inquiries or feedback, please write or call:
Department of Education – Division of Misamis Oriental
Don A.Velez St., Cagayan de Oro City
Contact number: 0917 899 2245
Email address: misamis.oriental@deped.gov.ph

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