Philippine Christian University 1

Dasmariñas Campus

ASSIGNMENT

In Partial Fulfilment of the Requirements

For the Partnership and Corporation Subject

FILIO, JONATHAN JOSHUA M.

20197023

BSA 3

September 16, 2020

 Philippine Christian University 2

Dasmariñas Campus

Exercise 1:

1. Suzy Davao owns and operates a jewellery store. During the past month, she

sold a necklace to a customer for P15,000. Suzy paid P10,000 for the necklace.

Required:

1. What type of business does Suzy own (manufacturer, wholesaler, retailer,

etc.)? Explain how you determined your response.

2. Calculate Suzy’s gross profit on the sale of the necklace.

3. Identify four costs besides the P10,000 cost of the necklace that Suzy might

incur in the operation of her jewellery store.

ANSWERS:

1. Suzy’s type of business is a retailer business. She sell goods to

consumer’s.

2. P5,000.00

3. Inventory costs, rent expense, operating and miscellaneous expense.

Exercise 2:

The chapter discussed five types of business, namely:

1. Manufacturer

2. Wholesale merchandiser

3. Retail merchandiser

4. Service

5. Hybrid
 Philippine Christian University 3

Dasmariñas Campus
Required:

a. Explain in your own words the characteristics of each type of

business.

b. Discuss how each of these five types of business is different from the

other four.

c. Five two examples of each type of business and explain how you

determined your answers.

ANSWERS:

1. Manufacturer type of business is a type of business that produces goods

intended for selling to other businesses like retail, wholesalers etc. They

commonly use raw materials to produce finished goods.

Wholesale Merchandise type of business are businesses that sells goods

in large quantities intended to be sold to retailers. They are done on a

large scale and extensive selling.

Retail merchandisers are businesses that sells finished goods to

consumers. They primary purpose of selling of for people to consume the

goods rather than reselling it.

Service businesses offers intangible goods. They sell something that is

valued beyond a physical product. They provide specific professional

support to its clients.

Hybrid businesses functions with the use of multiple means of reaching its

customers. Aside from the traditional way of distributing/selling they

commonly use the internet to expand its market and increase profitability.
 Philippine Christian University 4

Dasmariñas Campus
2. Manufacturing type of business is different from the other four types of

business in terms of it’s market and production. Manufacturing

businesses commonly sells their goods to wholesalers and other retailers.

They use raw materials and they’re also different because they make

their own product.

Wholesale merchandise type of business is also different in terms of its

market. They are the ones who supply other retailers and small business

retails out there. They usually get their goods on manufacturers and sell it

in large quantities to retailers.

Retail merchandise type of business are the ones who supply consumers

with goods with the intent of consuming. They commonly get their

products to manufacturers and wholesalers. They sell these products in

small quantities.

Service type of business is very unique amongst the four types because

they’re the ones who offer professional services and intangible products,

unlike the first three types who sells tangible goods.

Hybrid businesses is also unique because they apply the methods and

characteristics of each of business type mentioned above. They don’t

settle for only one characteristic, they apply other characteristics of other

business type to further improve their business.

3. MANUFACTURING BUSINESS

Ford Motor Company Philippines

Starmobile
 Philippine Christian University 5

Dasmariñas Campus
Ford is a well-known car manufacturer here in the our country while

Starmobile is a cellphone manufacturing business here in the Philippines,

WHOLESALE BUSINESS

Kily wholesale shop

Viajero wholesale clothing store

Kily and Viajero wholesale shops are wholesalers of clothes, accessories,

etc.

RETAIL BUSINESS

7/11

Alfamart

7/11 and Alfamart are two of the most well-known convenience store here

in the Philippines.

SERVICE BUSINESS

SGV & co.

Manabat San Agustin & co.

SGV and Manabat San Agustin are top accounting firms here in the

Philippines.

HYBRID BUSINESS

Max’s Restaurant

Kuya J’s Restaurant

Restaurants are one of the most easiest examples of hybrid businesses.

For an instance, restaurants combines ingredients in making a fine meal

(manufacturing), sells a cold bottle of beer (merchandising), and fills

customer orders (service)

 Philippine Christian University 6

Dasmariñas Campus

Exercise 3:

Presented below are three basic forms of business organization, follow by some

of the advantages and disadvantages relating to those forms of business;

a. Sole Proprietorship b. Partnership c. Corporation

1. __A__ Owner has total control

2. __C_ Greater business continuity

3. __C__ Easy transfer of ownership

4. __B__ Limited Liability

5. __C__ Greater access to capital

6. __A__ Easy and inexpensive to establish

7. __A__ Few government regulations

8. __A__ Easy to dissolve

9. __A__ No special income taxes

10. __A__ No sharing of profits

11. __C__ Greater management expertise

12. __C__ Usually has less access to capital than the other two forms.

13. __C__ Greater tax burden

14. __A__ Limited management expertise

15. __A__ Unlimited liability

16. __C__ Absentee ownership

17. __C__ Must share profits

18. __C__ Greater government regulation

19. __C__ Often difficult to dissolve

 Philippine Christian University 7

Dasmariñas Campus
20. __B__ Potential ownership conflicts

Required:

Match the letter next to each form of business with the appropriate advantage.

Note that each letter will be used more than once and it is possible that a

particular advantage applies to more than one of the business forms.

Exercise 4:

Professor Keanna Sotto is opening a publishing company to publish and

distribute accounting textbooks throughout the National Capital Region. She feels

this will be a successful venture because the textbooks will be based upon a

revolutionary new format of accounting education. Sotto has extended an

invitation to all her students to invest in her new business. She is offering shares

of stock for a mere P1,000 each.

Required:

a. What form of business is Professor Sotto proposing? Corporation

b. Briefly explain four advantages of doing business in such a form.

Advantages of a Corporation:

1. Easy to raise capital.

2. Limited Liability

3. Perpetual life

4. Transfers of ownership is easy.

 Philippine Christian University 8

Dasmariñas Campus

Exercise 5:

Match the letter next to each form of business with the appropriate items in the

following list of advantages and disadvantages. You may a letter more than once.

Use the form provided in your working papers.

A. Sole Proprietorship a 1. Easier to raise money

B. Partnership a 2. Limited expertise

C. Corporation c 3. Higher start-up costs

a 4. Owner has a total control

c & b 5. Shared profits

c 6. Higher taxes

a 7. Fewer regulations to follow

c 8. Easy transfer of ownership

b 9. Risk of conflict between

owners

c 10. Easy to expand

 Philippine Christian University 9

Dasmariñas Campus
Exercise 6:

Using the form in your working papers, identify each of the following as an

advantage or disadvantage of being a sole entrepreneur. For each item

you label a disadvantage, decide what actions you would take to overcome

the disadvantage. Analyze and describe how your actions might affect the

profit of your business earns.

1. Risking the loss of your savings DISADVANTAGE- to avoid the risk of

losing your savings, keep a record of your personal expenses and limit

your personal expenditures.

2. Deciding what you and everyone else need to do each day.

ADVANTAGE

3. Lacking steady wages and employee benefits. DISADVANTAGE- sole

proprietorship business means as a owner, you will not receive wages

and employee benefits, to avoid this kind of risk, put your savings into

investments like insurance, healthcare, etc.

4. Choosing when and where to work. ADVANTAGE

5. Keeping the financial benefits of your hard works. ADVANTAGE-

6. Choosing the people you want to work. ADVANTAGE

7. Paying all the expenses of a new business. DISADVANTAGE- when

engaging in a new business as a sole proprietor, it’s hard to shoulder all

the expenses at first, to avoid this, we must raise enough capital and find

affordable costs like rent, utilities, etc.

JONATHAN JOSHUA M. FILIO