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    B.pricing Entrepreneurship Revised

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    James Alegre
    Entrepreneurship fundamentals_2(PRICING EXAMPLE)

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    © All Rights Reserved
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    B.pricing Entrepreneurship Revised

    Uploaded by

    James Alegre
    22 views4 pages
    Entrepreneurship fundamentals_2(PRICING EXAMPLE)

    Original Title

    B.pricing Entrepreneurship Revised (1)

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    Entrepreneurship fundamentals_2(PRICING EXAMPLE)

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    22 views4 pages

    B.pricing Entrepreneurship Revised

    Uploaded by

    James Alegre
    Entrepreneurship fundamentals_2(PRICING EXAMPLE)

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 4

    B.

    PRICE

    Labors
    The entrepreneurs hired 5 people for business production, specifically 2 carpenters
    who receive a daily wage of 650 pesos, 2 painters with a daily wage of 630 pesos, and a cashier with 620
    pesos per day. Carpenters and painters are exclusively tasked with producing items. While the cashier is
    tasked with management, They work Monday through Saturday, dedicating 8 hours each day from 8 a.m.
    to 4 p.m., with Sundays designated as non-working days. This schedule amounts to a monthly income of
    15,600 pesos (total of 24 working days) for each carpenter, a monthly earning of 15,120 pesos for
    painters, and lastly, a cashier earning 14,880 pesos. The total amount for all workers is 45,600 pesos.

    Laborer No. of Laborers Wages per Hours Wages per Total cost Total cost
    Day per week per month

    Carpenters 2 PHP 81.25 PHP 650 PHP 3,900 PHP 15,600

    Painter 2 PHP 78.75 PHP 630 PHP 3,780 PHP 15,120

    Cashier 1 PHP 77.05 PHP 620 PHP 3,720 PHP 14,880

    Total PHP 45,600

    Table 1. Labor Cost

    Direct Materials
    The table shows the direct material which also listed in the capital sourcing table no.2 and has the total
    amount of ₱529

    Materials Amount

    Sitwel ₱60

    2 Hinge small ₱10

    1 Hooke & eye ₱5

    4 Concrete ₱4

    Poster paint ₱50

    Paint brush ₱25

    Varnish ₱75

    Plywood ₱300

    Total ₱529

    Table 2. Direct Material Cost


    Factory Overhead
    The entrepreneur’s factory overhead totals ₱136,588. This includes the total labor
    cost per month, direct materials, indirect materials, the product cost, and the other factory overhead,
    which is the electricity bill with the amount of ₱8,000, the water bill with the amount of ₱5,000, and the
    Internet bill with the amount of ₱1,399 montly and the Rental with the amount of ₱75,000 per month. The
    total amount of the other factory overhead is ₱89,399
    Indirect materials also play an important factor in the process of creation; this
    includes a Carpenter 2 Hand Saw that cost a total of ₱260, 2 Philips Screw Drivers total of ₱160, and 2
    pieces of Mongol Pencils total of ₱30. 2 hammers total of ₱460, 2 paint brushes total of ₱50, and 2 poster
    paint total of ₱100, with a combined amount total of ₱1,060.

    Indirect Materials Amount

    2 Carpenter Hand Saw ₱260


    2 Philips Screw Drivers ₱160
    2 Mongol Pencil ₱30
    2 Hammers ₱460
    2 paint brushes ₱50
    2 poster paint ₱100
    Total ₱1,060

    Table 3. Indirect Materials

    This Table shows the other Factory Overheads which is the Electricity Bill, Water
    Bill, Internet bill and their amount.

    Other Factory Overhead Amount/per month

    Electricity bill ₱8,000


    Water bill ₱5,000
    Internet bill ₱1,399
    Rent ₱75,000
    Total ₱89,399

    Particular Amount
    Indirect Material ₱1,060
    Other Factory Overhead ₱89,399

    Total ₱90,459

    Table 4. Factory Overhead Cost

    Product Cost
    The 4th table shows that the total product cost is obtained by summing up the
    calculated amounts of cost.

    Particulars Amount

    Labor ₱45,600

    Direct Material ₱529

    Factory Overheads ₱90,459

    Total ₱136,588

    Table 4. Product Cost


    Cost Per Unit
    The table displays the cost associated with each product, while the "number of units"
    indicates the quantity of products manufactured.

    Particulars Amount

    Total Product Cost ₱136,588

    Number of Units Produced 258

    Total ₱529

    Table 5. Cost Per Unit

    Product Cost Cost Per Unit


    ₱136,588 ₱529

    Summary of all tables


    Product Price

    Money Frame 661.25

    Price Strategy
    The entrepreneurs choose to use Psychology pricing. Psychology pricing
    is effective in marketing because it leverages principles of human psychology to influence
    consumer perception and behavior. By setting prices strategically, businesses can create a
    psychological impact that enhances the perceived value of a product or service, encourages
    purchasing decisions, and fosters a positive consumer experience.

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