LESSON

1 HOW ORGANIZATIONS CONTRIBUTE TO SOCIO

ECONOMIC DEVELOPMENT

OBJECTIVES:
K: define socio-economic development;
S: explain the role of each form of business organization in
socio-economic development; and
A: appreciate the role of business organizations in socio-
economic development.

LEARNING COMPETENCY:
Show how organizations contribute to socio economic
development (ABM_ESR12-IIIa-d-1.3)

I. What Happened

Let us have a recall!

Instruction. Identify the firms listed below according to its forms of business
organization. Write your answer on the matrix provided.

• ABC Bakeshop
• Dumaguete Cathedral Credit Cooperative (DCCCO)
• Philsouth Properties and Development Corporation
• Ana’s Sari-sari Store
• San Miguel Corporation
• Chef Tobz Cakes and Pastries Partnership
• Negros Oriental II Electric Cooperative Inc.

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 FORMS OF BUSINESS ORGANIZATION
Sole/Single Proprietorship Partnership

Corporation Cooperative

PRE-TEST:

Multiple Choice. Encircle the letter that corresponds the correct answer.

1. What process that seeks to identify both the social and the economic needs
within a community and seek to create strategies that will address those needs
in ways that are practical and in the best interests of the community over the
long run.
A. Sustainable Development B. Socio-economic Development
C. Business Development D. All of these
2. Which of the following role of Sole/Single proprietorship in which sole owners
deliver the merchandise to consumers at their doorsteps.
A. Job Creation B. Supply of Quality Goods
C. Provide Investment Avenue D. Helpful to Consumers
3. Which role to socio-economic development is common to all forms of
business organization?
A. Job Creation B. Better Jobs in terms of compensation and stability

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 C. Employment D. All of these
4. Which of the following is NOT part of the role of a partnership to socio
economic development?
A. Provide Employment B. Production of Goods and Services
C. Help Small Producers D. Increase in Government’s Revenue
5. What is your analysis of the given statements below?
Statement 1: Corporation seeks employment stability as a means of
achieving high commitment, high involvement, and flexibility among their
employees.
Statement II: Tax is a revenue of the government that funds government
expenditures and program.
A. Both Statements are true B. Only Statement 1 is true
C. Only Statement II is true D. Both Statements are false

II. What You Need to Know

Discovering a Concept!

What is socio-economic development?

Socio-economic development is a process that seeks to identify both the
social and the economic needs within a community, and seek to create
strategies that will address those needs in ways that are practical and in the best
interests of the community over the long run.
The general idea is to find ways to improve the standard of living within
the area while also making sure the local economy is healthy and capable of
sustaining the population present in the area. Socio-economic development
occurs in neighborhoods in metropolitan areas, sections of smaller cities and
towns, and even in rural setting.

DISCUSSION

The Role of Each Form of Business Organization in the Economy

Business organizations regardless of what form it is share common purpose

and role in socio-economic development, in principle they should help in the
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promotion of common good and in the protection of persons’ rights and
interests.

1. Sole/Single Proprietorship

a. Create Job
Probably the most important way in which a Sole owner helps improve an
economy is through the creation of jobs. Sole owner business organizations
provide employment opportunities to less educated and uneducated workers
and help minimize unemployment problem in the society. They move quietly,
offer jobs to few people. Employing people at each local business contributes to
the success to the locality, as with the wages they earn, people buy property,
shop and invest freely in where they live. Small businesses also serve as training
ground to workers before they can be hired to large business organizations.
For instance, Bakeries, cake shops, repair shops, law offices and dental
services create jobs that bring money for residents who then spend their wage
at other local businesses which develop the local economy.

b. Help Small Producers

Most of the goods sold by sole owners are purchased locally from local
producers, thus local producers are benefited by sole owners. Typically, it offers
a larger number of locally produced goods compared to larger, national, or
global chains. A large amount of money spent at local business stays in the
locality. This is a distinct benefit for the other local business, families, and workers
in the area.
c. Provide Investment Avenues
Sole owner organization provides a chance for small investors who has
small amount of capital to utilize their savings to engage new business. Anybody
can start their own business as long as they have capital. Small business can
give an individual a chance to gain experience, which the person may use later
a larger scale.
For instance, an accountant can start a small business in the comfort of her own
home, using the laptop and internet connection she already has without paying
a lease for space, then gradually add staff as they grow.
d. Help Consumers
Sole owners deliver the merchandise to consumers at their doorsteps. So,
time and energy of the consumers are saved. They offer convenience to buyers
wherein buyers can easily purchase products.

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For instance, Online selling, Customers can purchase what goods/products they
need and want quickly and efficiently at their convenience. if someone needs a
product, they can easily order it and delivered.
e. Supply Quality Goods
Sole owners sell goods of high quality to maintain their reputation, thus
accepting return of defective merchandise. This ensures the safety and welfare
of the public.
For instance, A sari-sari store owner sells quality products encourage customers
to buy more and keeps them coming back as they say, “Go above and
beyond for customers” and you will be rewarded with repeat business.

2. Partnership

a. Provide Employment
Providing employment opportunities for all is the single most effective
means of tackling poverty and social exclusion, thus improve individual’s
standard of living. Residents in town and cities should share in higher living
standards through employment.

b. Produce of Goods and Services

Businesses are designed to serve a particular need that people have, and
to provide trusted goods and services related to that need. Without partnership
business production of some of the goods and services will be
inefficient. However, partners will bring out their technical and managerial skills
during the production of goods and services which has more quality and
increase the qualities of such goods. Likewise, partnership business will allow
individuals with limited capital to team up together to produce necessary goods
for the teaming population.

c. Increase Government’s Revenue

Partnership business helps to increase governments revenue through the
payment of taxes hence, without partnership business, there would not be much
private Companies which will on the other hand affect the government’s
revenue generation.
For instance, Marie and Pastries register the business with the Bureau of Internal
Revenue (BIR) which requires an annual registration fee and each of the
partners will be taxed upon his/her share of the income from the partnership
hence, increasing government’s revenue.

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 3. Corporation

a. Offer Better Jobs in terms of Compensation and Stability

Corporation pays higher salaries ang wages to employees which makes
them stay in the company until they retire. Corporations seek employment
stability as a means of achieving high commitment, high involvement, and
flexibility among their employees. Employment stability may also have a positive
impact on the reputation of the organization, which in turn, may help in
attracting and retaining employees. Employment stability helps organizations
avoid procyclical hiring. Given all the potential benefits of employment security
people has no reason to leave.

b. Increase Tax Revenue

The increased presence of companies in the region translates to
increased tax revenue for community projects and local infrastructure. Taxes
that are collected by the government will be used to fund government
expenditures and programs.
For instance, AvocadoCrave organized as corporation are made to settle their
income tax liabilities and submit their income tax returns (tax form) to the Bureau
of Internal Revenue (BIR) consequently, money received increases tax revenue.

c. Improve Quality of Life

Corporation is becoming a tool to improve quality of life. Better

infrastructure and more jobs improve the economy of the region and raises the
standard of living for its residents. Corporation produces personal products and
technology that are rapidly growing in popularity that make people’s lives
easier and faster.
For instance, your smart phone allows you to stay always connected to your
friends and family members and you have access to an infinite amount of
information right at your fingertips.
Technology is there to make people’s lives easier and improve their quality of
life.

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 4. Cooperative

a. Provide Employment
Cooperatives are significant in providing jobs, aside from giving salaries
and wages to employees, they also provide opportunities to upgrade the skills of
their employees through workshops and courses. They also offer employment to
students on casual-appointment basis during long vacations.

b. Pay Local Taxes

Cooperatives need to meet local tax obligation to stay in good legal
standing. Taxes are used to maintain infrastructure of a city, such as roads,
bridges, public transportation, libraries and other public buildings and services. It
is also used for the salaries of public employees such as teachers, nurses,
doctors, agriculturist, policemen and many more.

c. Respond to Production and Consumption

Responsive production and consumption are “Doing more and better
with less” increasing net welfare gains from economic activities by reducing
resource use, degradation, and pollution along the whole lifecycle of the
corporation, while increasing quality of life.
The production and consumption of healthy food is envisioned to create
healthy consumers, reduce the cost of health maintenance, and increase the
allocation of financial resources to productive activities.
It also promotes resource and energy efficiency, sustainable infrastructure,
and providing access to basic services, green and a better quality of life for all.

III. What Have I Learned

Remember Key Ideas!

Business Organization is important to a country’s economy and its success can
drive the success of an entire country and even to the global economy.

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 The Role of Each Form of Business Organization in the Economy
Sole/Single Proprietorship • Create Job
• Help small business producers.
• Provide investment avenue
• Help consumers
• Supply quality of goods

Partnership • Provide employment

• Produce of goods and services
• Increase in government’s revenue

Corporation • Offer Better jobs in terms of

compensation and stability
• Increase tax revenue
• Improve quality of life

Cooperative • Provide employment

• Pay local taxes
• Respond to production and
consumption

EVALUATION:

Multiple Choice. Choose the letter that corresponds the correct answer.
1. 1. What process that seeks to identify both the social and the economic
needs within a community and seek to create strategies that will address those
needs in ways that are practical and in the best interests of the community over
the long run.
A. Socio-economic Development B. Sustainable Development
C. Business Development D. All of these
2. Which of the following role of Sole/Single proprietorship sell merchandise of
high quality to maintain their reputation, thus accepting return of defective
merchandise

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 A. Create Job B. Supply Quality Goods
C. Provide Investment Avenue D. Help Consumers
3. Which form of business organization pay taxes to the government?
A. Sole/single proprietorship B. Partnership
C. Corporation D. All of these
4. The following are the contributions of Corporation Except for _______________.
A. Offer Better Jobs in terms of compensation and stability
B. Increase Tax Revenue
C. Help small producers
D. Improve Quality of Life
5. What is your analysis of the given statements below?
Statement 1: Responsive production and consumption promotes resource
and energy efficiency, sustainable infrastructure, and providing access to basic
services, green and a better quality of life for all.
Statement II: A general partner actively manages and exercises control
over the company.
A. Both Statements are true B. Only Statement 1 is true
C. Only Statement II is true D. Both Statements are false

Additional Activity

Direction: Identify at least 3 organizations and explain its contribution to socio-

economic development in your locality/community. Write your answers in your
activity notebook.

Name of the Organization Contribution to Socio-Economic Development

(2pts each) (Please see rubrics below for the scoring)

1.

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2.

3.

Areas of
4pts 3pts 2pts 1pt
Assessment
Ideas Presents ideas in Presents ideas Ideas are too Ideas are
an original in a consistent general vague or
manner manner unclear
Organization Strong and Organized Some No
organized beg/mid/end organization: organization;
beg/mid/end attempt at a lack
beg/mid/end beg/mid/end
Understanding Writing shows Writing shows a Writing shows Writing shows
strong clear adequate little
understanding understanding understanding understanding
Word Choice Sophisticated Nouns and Needs more Little or no use
use of nouns verbs make nouns and of nouns and
and verbs make essay verbs verbs
the essay very informative
informative
Sentence Sentence Sentence Sentence No sense of
Structure structure structure is structure is sentence
enhances evident; limited; structure or
meaning; flows sentences sentences need flow
throughout the mostly flow to flow
piece
Mechanics Few (if any) Few errors Several errors Numerous
errors errors
https://www.thoughtco.com/essay-rubric-2081367

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LESSON FORMS OF BUSINESS ORGANIZATIONS IN TERMS OF
2 PURPOSE AND ROLE IN SOCIO-ECONOMIC
DEVELOPMENT

OBJECTIVES:
K. Enumerate the forms of business organization in terms of
purpose and role in socio-economic development
S. Differentiate the forms of business organization according to
their purpose and role in socio-economic development
A. Display appreciation of the different forms of business
organization
LEARNING COMPETENCY:
Differentiate the forms of business organizations in terms of their
purpose and role in socio-economic development.

I. What Happened

Good day! We are here to help

you know more about the
different forms of business
organization in terms of their
purpose and their role in the
socio-economic development.

That’s right! And to guide you with

learning those, let us recall first the
different forms of business
organizations according to the nature
of ownership as discussed in ABM 1. To
help you remember it, please answer
the activities proceeding. Have fun!
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PRE-ACTIVITY/PRE-TEST:
ACTIVITY 1. “Categorize Me “
Directions: Categorize each situation below as to: Sole Proprietorship;
Partnership; or Corporation. Write your in your notebook.

______1. I am a grocery store owned by Maria.

______2. I am the barber shop owned by Tom and Jerry who contributed money
to get the business started.

______3. I am a business entity organized as a separate legal entity (artificial

person) under the corporation law with ownership divided into transferable
shares of stocks.

_____4. I am the Salon organized by David who acted as the manager at the
same time.

_____5. J&J sari-sari store formed by Joy and Jean with Jean contributing her
land and building for the business and Joy contributing ₱ 100, 000 to start its
operation.

II. What You Need to Know

Activity 2.
On your notebook, arrange the jumbled letters in 5 minutes.

1. MTURAACNUFING 4. MERDISNINCHAG

2. BUESSINS ETHICS 5. GONAVERNCE

3. SEICERV 6. LALEG RESILISIBPONTY

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DISCUSSION:
Forms of Business
Organization in
Terms of their
Purpose

Manufacturing
Merchandising This type of
Service
This type of business buys raw
This type of
business buys at materials and
business offers or
wholesale and uses them in
perform skills for a
later sells the making a new
fee.
products at retail. product for sale
later on.

Role of Business in Socio-Economic Development

Business Ethics
It is the set of moral principles or values that may be general or professional. It
tells us what is right or wrong in business situation.

Legal Responsibilities

• All business enterprise needs to comply with a country's laws and

regulation. Obedience to local, national, and relevant international laws
constitutes legal responsibility. A selection of essential laws that explain
legal responsibilities of the Philippine enterprises includes the following:
1. Corporation Code (Batas Pambansa bilang 68)
➢ It dictates the most important legal responsibilities towards
investors and owners as a guarantee that the enterprise is
managed in the interest of its stockholders.
2. Consumer Act of The Philippines (R.A. 7894)
➢ It details the legal responsibilities of enterprises toward their
buyers, suppliers, tradesmen, and distributors.
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3. Minimum Wage Law
➢ It entails the compliance of organizations with the minimum
wages that their employees are entitled to.
4. Migrant Workers and Overseas Filipino Act of 1995 (R.A. 8042)
➢ It is an act that looks after the employees working in foreign
countries.
5. Environmental Legislation which includes the following:
A. Presidential Decree 1586
➢ It includes other environmental management related issue.

B. R.A. 6969
➢ It covers the importation, manufacture, processing, handling,
storage, transportation, sale, distribution, use, and disposal of
all unregulated chemical substances and mixtures in the
Philippines.

C. R.A. 8749
➢ It includes the clean air act of 1999 and oversees the
formulation of a holistic national program against air
pollution.

D. R.A. 9003
➢ It is concerned with the Philippine ecological Solid waste
management act of 2000--calls for the institutionalization of a
national program that will manage the control, transfer,
transport, process, and disposal of solid waste in the country.

E. R.A. 9275
➢ It looks at the clean water act of 2004 and aims to protect
the country's body of water from pollution from land-based
sources.

F. R.A. 9512

➢ It gives permission for the environmental awareness and

education act of 2008 and mandates to catalyze
environmental education in the country.

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Corporate Governance
It is the set of procedures designed to ensure that the company is managed
in the interests of the shareholders.

Business ethics, legal responsibility and corporate

governance help define the role of business in
economic development but the primary role of
business in the socio-economic development is the
creation of jobs. Employment advances economic
development and boosts social indicators to
satisfactory level. The observance of business
ethics, where business and industry look out for their
stakeholders, assures this honest wages of the
employees, reasonable returns for investors and
owners, and decent transaction with suppliers
certify income allocation.

• Observe the businesses in your area which are still

operating, how do you think these businesses helped
the people in your community?

• Listen to the news or go over the internet and look for

the businesses ceased because of breaking laws, how
did it affect its employees, owners and stakeholders?
How important are businesses in our society and
economy?

• As a student, in your own little ways, how are you

going to show to others to be legally responsible?

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III. What Have I Learned
EVALUATION/POST TEST:
Test I.
Directions: Identify if it is a service, merchandising or a manufacturing form of
business. Write the answer of your choice on the space provided.

_______1. Provides services to customers

_______2. Sells goods to customers
_______3. Raw materials are available
_______4. Goods to be sold are purchased from a supplier
_______5. Goods to be sold are produced by the company itself
_______6. Supplies are used, no goods to be sold
_______7. Bakery
_______8. Barber shop
_______9. Cellphone store
_______10. Abenson appliances
_______11. Bruno’s Barber Shop
_______12. Clean Ko Place Mo Cleaning Services
_______13. Tutorial Services
_______14. Manila Hotel
_______15. Cynthia’s Food Vendor
_______16. Susan’s Roses Flower Shop
_______17. Wash Your Problem Laundry Shop
_______18. Bread Pit Bakery
_______19. Cut and Face Parlor
_______20. Fish Be with You Fish Shop

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ADDITIONAL ACTIVITY

Direction: Give at least 3 businesses in your locality. Identify its purpose and role
in socio-economic development. Write your answer in your activity notebook.

Forms of Business Name of the Business Purpose and Role in Socio-

Organization (2pts each) Economic Development
(Please see rubrics for
scoring)
Sole Proprietorship

Partnership

Corporation

Cooperative

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Areas of
4pts 3pts 2pts 1pt
Assessment
Ideas Presents ideas in Presents ideas Ideas are too Ideas are
an original in a consistent general vague or
manner manner unclear
Organization Strong and Organized Some No
organized beg/mid/end organization: organization;
beg/mid/end attempt at a lack
beg/mid/end beg/mid/end
Understanding Writing shows Writing shows a Writing shows Writing shows
strong clear adequate little
understanding understanding understanding understanding
Word Choice Sophisticated Nouns and Needs more Little or no use
use of nouns verbs make nouns and of nouns and
and verbs make essay verbs verbs
the essay very informative
informative
Sentence Sentence Sentence Sentence No sense of
Structure structure structure is structure is sentence
enhances evident; limited; structure or
meaning; flows sentences sentences need flow
throughout the mostly flow to flow
piece
Mechanics Few (if any) Few errors Several errors Numerous
errors errors

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