BUSINESS MATH The first and fourth terms are called the

extremes. The second and third are called

the means. (Licuanan, P., 2016)

MODULE 1 : Fractions, Decimals, and

Percentage Fundamental Property of Proportions

Changing Fractions to Decimal – In any proportion, the product of the means is

equal to the product of the extremes. That is,
 terminating decimal the cross products of the terms are equal.
 repeating decimal.

FINDING THE PART

Types of proportion (variation):
Formula : Part = Rate × Base.
1.Direct proportion - x= y= ; x= y=
2. Indirect/Inverse – x= y= ; x= y=
3. Partitive proportion - a whole
is divided into more than two
Fraction - tells us how many parts of a whole parts. (Licuanan, P., 2016)
we have. Composed of numerator and
denominator.
MODULE 5 : Mark-up, Mark on
Numerator - is the upper portion of the and Mark-down
fraction.
Denominator - is the lower portion of the
fraction. Cost Price is the price that a company or
store has to pay for the goods it is going to
Vinculum - a horizontal line drawn over a sell or the price that has to be spent to
number ;the preceding or following operator.
produce goods or services before any profit is
Terminating Decimal - those numbers which added.
come to an end after few repetitions after
decimal point. Operating Cost is the price spent relative to
the production and sale of commodity.
Repeating Decimal - a number whose digits
are periodic and infinitely repeated portion is Profit is the money earned after the cost
not zero. price and the operating costs accounted for
MODULE 2 : after the sale of a commodity

Changing Decimals to Fractions Selling Price is the price in which the

commodity or good is sold per unit.
Changing Decimals to Percent
0.12 = 12% FORMULA :
SELLING PRICE = Cost Price + Operating
Changing Percent to Decimals Expenses + Profit
4% = 0.04 I. Mark – up (margin or gross profit)
MODULE 3 : Key Concepts of Ratio and
The difference between the selling price (S)
Proportion and the cost price (C);the sum of all
A PROPORTION is a statement that two expenses (E) and profit (P).
ratios are equal. i. Mark – up = Operating Expenses +
Profit
 ii. Mark – up = Selling Price - Cost Cost of goods sold or cost of sales is how
much the seller buys the item.
A. Mark-up Rate Based on Cost Discount series is a type of discount in
which several discounts are given at different
- The cost is taken as the base to express the times and different conditions.
mark-upMark-up
in terms of percent. Method 1.
X 100%
MC = Cost List Price -------------------------------------- ₱5,720.00
Less 20% (₱5,720 X 20%) ------------------ 1,144.00

B. Mark-up Based on Selling Price Difference-- ----------------------------------- ₱4,576.00

- the selling price is taken as the base to Less 5% (₱4,576 X 5%) --------------------- 228.80
express Mark-up
the mark-up in terms of percent.
X 100% Net Price -------------------------------------- ₱4,347.20
Ms = Selling Price

List price is the fee for a service or product

before discounts are reduced or sales are
added.
Margin (also known as gross margin) is
sales minus the cost of goods sold or cost
II. Mark – on of sales.
The increase of prices that are already Margin = sales – cost of goods sold.
charged on their products. Mark-up is the amount by which the cost of
Mark – on = New Selling Price – Selling a product is increased in order to derive the
Price selling price.
Net price is the final charge you pay for a
III. Mark – down product or service after discounts and sales
A. Temporary mark – down is a taxes are computed.
reduction in the selling price of an item Net price = list price – trade discount
to encourage consumers to increase
Net Price = Original Price – Trade
their demand on a particular product.
Discount
B. Permanent mark – down is
implemented by companies to remove Sales is the account used to report the
a “poor-sale” product from their selling price of the merchandise.
inventory. Trade discount is a reduction from list
price granted to buyers.
Mark – down = Original Price – Selling
Trade discount = single trade
Price
discount rate x list price

𝑇𝑟𝑎𝑑𝑒 𝐷𝑖𝑠𝑐𝑜𝑢𝑛𝑡 = 𝑂𝑟𝑖𝑔𝑖𝑛𝑎𝑙 𝑃𝑟𝑖𝑐𝑒 𝑥

Mark-down
X 100%
𝐷𝑖𝑠𝑐𝑜𝑢𝑛𝑡 𝑅𝑎𝑡𝑒 CASE 2
Mark-down Rate = Original price
CASE 1 CASE 1
MODULE : PROFIT AND LOSS
Net Sales ₱ 1,000 Net Sales ₱ 1,000 Net Sales ₱ 1,000
MODULE 6: Gross Margin, Trade
Less: Cost 500 Less: Cost 1,200 Less: Cost 1,000
Discount and Discount Series Loss ₱ (200) Break-even ₱ 0
Profit ₱ 500

𝐷𝑖𝑠𝑐𝑜𝑢𝑛𝑡 = 𝐿𝑖𝑠𝑡 𝑃𝑟𝑖𝑐𝑒 𝑥 𝐷𝑖𝑠𝑐𝑜𝑢𝑛𝑡

Computing for discounts

𝑅𝑎𝑡𝑒
Discount = List price – Net price
Variable costs the amount paid for raw MODULE 8 : Break-even Analysis and
materials or ingredients needed to produce a
Problem Solving Involving
product or a cost of a product intended for
resale. Buying and Selling Products

Fixed Cost are other expenses that you  Total Cost (TC) – This is the sum of
might incur in operating your business like the fixed cost and variable cost.
rent, salary, insurance fees, interest  Break-even point is the number of
payments, office and store supplies and etc. units of goods or products needed to
be sold in order to cover the all the
costs.
Steps  Break-even analysis is the process
used to determine the number of units
Variable cost per sack of rice =
1. Identify and label all the of products to sell in order to cover the
Fixed Costs of Business =
information needed to solve costs.
the problem. Break Even Point=
Fixed
2. Compute the selling price Cost
of Mark-up = cost x desired mark-up rate
the product. Recall previous = ₱2,000 x 0.20
Selling Price per unit - Variable Cost per unit
lesson about mark up. In this Mark-up = ₱400
problem, a mark-up of 20% is MODULE 9 : SOLVING PROBLEMS ON
desired based on cost. SIMPLE INTEREST
Selling Price = cost + mark-up
= ₱2,000 +
A deposit is a financial term that means
Selling Price = ₱2,400 money is held at a bank
3. Compute the net sales by Net Sales= Quantity sold x Selling Price
A loan is a money (or property) given with the
multiplying the quantity sold = 20 x ₱2,400
promise that it will be paid back in the future,
by its selling price. Net Sales = ₱48,000
usually with interest.
4. Identify and compute the
variable cost of sales by Services
Variable Cost = Quantity sold arecost/unit
x Variable professional support to aid
multiplying the quantity of = 20 x customers; intangible product.
output sold by its variable cost Variable Cost = ₱40,000 Utilities refer to the basic amenities like
per unit. electricity and water.
5. Identify and compute the total ₱ 5,000 ( rent )
fixed costs by adding all the +
Mortgage is a loan, secured by a collateral,
₱ 2,000 (gasoline)
costs necessary to keep the that the borrower is obliged to pay at
₱ 3,000 (wages)
business running. specified terms.
---------------------
Fixed Cost = ₱ 10,000 Amortization is the process of reducing a
Net sales cost or total in regular small amounts.
₱48,000
Less: Variable Cost 40,000
6. Use simple income statement Interest is described as the money paid
to compute the profit or loss regularly at a particular rate for the use of
Gross Profit 8,000
money lent, or for delaying the repayment of
in the problem.
Less: Fixed Cost 10,000
a debt.
Net Loss (₱
Principal is the original amount invested or
borrowed.
Rate is the amount of a charge or payment
(usually in percent) with reference to some
basis of calculation.
Time can be defined as the duration or term
used in solving simple interest.
FORMULA :
Interest = Principal x rate x time
Principal = Interest ÷ rate x time
Rate = Interest ÷ Principal x time
Time = Interest ÷ Principal x rate
Future Interest = Principal (1 + rate x time)
Down payment = down payment rate ×
cash price
Amount of the loan (mortgage) = cash
price − down payment