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Types of Business

According to
Activities
FUNDAMENTALS OF ACCOUNTANCY, BUSINESS
AND MANAGEMENT 1
How the following
businesses earn
profits?
(1)

Bruno’s Barber
Shop
(3)

Clean Ko Place Mo
Cleaning Services
(4)

Bread Pit Bakery


(5)

Wash Your Problem


Laundry Shop
(6)

Susan’s Roses
Flower Shop
(7)

Manila Hotel
3 types of Business
organizations
1. Service Business
This type of business
offers professional
skills, advice and
consultations.
Examples of Service Business:
• barber shops,
• beauty parlors,
• repair shops,
• banks,
• accounting and law firms
• Merchandising
Business
This type of business
buys at wholesale and
later sells the products
at retail.
• Merchandising Business
They make a profit by selling
the merchandise or products
at prices that are higher than
their purchase costs.
This type of business is also
known as "buy and sell".
Examples of Merchandising
Business are:
• book stores,
• sari-sari stores,
• hardware stores
• Manufacturing Business
This type of business buys
raw materials and uses them
in making a new product,
therefore combining raw
materials, labor and expenses
into a product for sale later.
Inventory
It refers to all items,
goods, merchandise, and
materials, held by
business for selling in the
market to earn a profit.
Three kinds of
Inventory:
• Raw Materials
• Work-In-Progress
• Finished Goods
Examples of Manufacturing
Business are:
• shoe manufacturing
businesses,
• car manufacturing plants
• garments factory
•Additional information
There are businesses that
may be classified under
more than one type of
business. They are called
“HYBRID”
Examples of this businesses are:
• A bakery, combines raw materials
in making loaves of bread
(manufacturing), sells hot Pan de
Sal (merchandising), and caters
customers’ orders in small coffee
table servings of ensaymada and
hot coffee (service)
ACTIVITY:
Identify the following item if
it is a service, merchandising,
manufacturing business or
hybrid
(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

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