UNIVERSITY OF CEBU – METC I.

MODIFIED TRUE or FALSE: Write TRUE if

3rd Summative Examination in the statement is correct, otherwise if false,
ENTRPRENEURSHIP explain/replace the specific word in the
statement.
I. MODIFIED TRUE or FALSE: Write TRUE if 1. The suppliers of raw materials need not be reviewed
the statement is correct, otherwise if false, and evaluated as long as they extend credit terms to
explain/replace the specific word in the the business.
statement. 2. The functions of other service departments need not
1. The suppliers of raw materials need not be reviewed be included in the operation plan since they do not
and evaluated as long as they extend credit terms to have any direct participation in making the product.
the business. 3. Anybody in the business can receive the goods
2. The functions of other service departments need not shipped by the supplier as long as the order has been
be included in the operation plan since they do not authorized.
have any direct participation in making the product. 4. The different positions and the relationships of the
3. Anybody in the business can receive the goods positions in the business are usually depicted in the
shipped by the supplier as long as the order has been organizational chart.
authorized. 5. The selection of the production plant site must be
4. The different positions and the relationships of the provided with a clear description as to its proximity
positions in the business are usually depicted in the to the source of raw materials.
organizational chart.
5. The selection of the production plant site must be II. IDENTIFICATION: Identify the Nature of
provided with a clear description as to its proximity the Business of the following items.
to the source of raw materials. 1. Law firms
2. Grocery stores
II. IDENTIFICATION: Identify the Nature of 3. Poultry products
the Business of the following items. 4. Fast-food chains
1. Law firms 5. Fishpond ventures
2. Grocery stores 6. Samsung company
3. Poultry products 7. Non-profit organizations
4. Fast-food chains 8. It is the producer of goods or products.
5. Fishpond ventures 9. It does not alter the appearance of the product
6. Samsung company purchased from the seller.
7. Non-profit organizations 10. It possesses the characteristics and nature of
8. It is the producer of goods or products. combined types of business entities.
9. It does not alter the appearance of the product
purchased from the seller. III. IDENTIFICATION: Identify the Forms of the
10. It possesses the characteristics and nature of Business of the following items.
combined types of business entities. 1. Its growth is limited.
2. Stock and Non-Stock
III. IDENTIFICATION: Identify the Forms of the 3. Issues Certificate of Stock
Business of the following items. 4. It is easy to form and manage.
1. Its growth is limited. 5. It is a simple business operation
2. Stock and Non-Stock 6. It is owned by two or more persons.
3. Issues Certificate of Stock 7. The owner has unlimited liability only.
4. It is easy to form and manage. 8. Profit or loss is divided among these people.
5. It is a simple business operation 9. It is formed by at least five but not more that
6. It is owned by two or more persons. fifteen persons.
7. The owner has unlimited liability only. 10. The life of the form of business is easily
8. Profit or loss is divided among these people. dissolved compared to the other two.
9. It is formed by at least five but not more that
fifteen persons.
10. The life of the form of business is easily
dissolved compared to the other two.

IV. SOLVE

1. You are the operations manager of a bakery that specializes

in producing artisan bread. Over the last quarter, your team
has been busy baking a variety of bread to meet customer
UNIVERSITY OF CEBU – METC
demand. Throughout this period, you've diligently tracked the
3rd Summative Examination in
costs involved in the production process. The direct Material
ENTRPRENEURSHIP
Costs - Flour $2,000, Yeast: $500, and Salt: $100. Direct
Labor Costs - Bakers: $4,000, Assistants: $2,000, and Quality
control: $500 and the Overhead Costs - Equipment Your task is to calculate the total production cost and the cost
maintenance: $1,000, Utilities: $800, andPackaging: $300. per product, considering all the detailed breakdowns of direct
Throughout the quarter, your team successfully produced material and direct labor costs, as well as the factory overhead,
10,000 loaves of bread, each meticulously crafted to meet the over the duration of one quarter. Then, determine the selling
highest standards. price if the owner wants a 120 percent profit. Finally, calculate
the total profit if all the bread has been sold.
Your task is to calculate the total production cost and the cost
per product, considering all the detailed breakdowns of direct Formulas:
material and direct labor costs, as well as the factory overhead,
over the duration of one quarter. Then, determine the selling  Total Production Cost = Direct Material Cost + Direct
Labor Cost + Overhead Cost
price if the owner wants a 120 percent profit. Finally, calculate
 Cost per Product = Total Production Cost / Number of Units
the total profit if all the bread has been sold.
Produced
Formulas:  Selling Price = Total Production Cost + (Total Production
Cost * Profit Margin)
 Total Production Cost = Direct Material Cost + Direct  Total Profit = Selling Price - Total Production Cost
Labor Cost + Overhead Cost
 Cost per Product = Total Production Cost / Number of Units
Produced
2. You're managing the operations of a printing press,
 Selling Price = Total Production Cost + (Total Production
Cost * Profit Margin)
responsible for producing various types of documents for
 Total Profit = Selling Price - Total Production Cost clients. Your evaluation includes the costs associated with
printing equipment. A high-speed printer was purchased for
80,000 pesos, with an expected lifespan of five years.
Additionally, a binding machine, essential for finishing printed
2. You're managing the operations of a printing press, documents, was acquired for 50,000 pesos, also with a lifespan
responsible for producing various types of documents for of five years. Now, you need to calculate the possible
clients. Your evaluation includes the costs associated with overhead cost for each machine considering that the printing
printing equipment. A high-speed printer was purchased for press processes 600 documents per day.
80,000 pesos, with an expected lifespan of five years.
Additionally, a binding machine, essential for finishing printed 1. Determine the total factory overhead cost of two
documents, was acquired for 50,000 pesos, also with a lifespan machines.
of five years. Now, you need to calculate the possible 2. If the electricity cost for running both machines is 15
overhead cost for each machine considering that the printing pesos per hour each, calculate the additional daily
press processes 600 documents per day. overhead cost.
3. Considering that maintenance and repair costs for the
1. Determine the total factory overhead cost of two high-speed printer amount to 8% of its initial cost
machines. annually, find the yearly overhead cost for maintenance.
2. If the electricity cost for running both machines is 15
pesos per hour each, calculate the additional daily Formulas:
overhead cost.
3. Considering that maintenance and repair costs for the
high-speed printer amount to 8% of its initial cost
annually, find the yearly overhead cost for maintenance.

Formulas:

So, the selling price per loaf with a 120% profit

margin would be $24,640, and the total profit if all
the bread is sold would be $13,440. To calculate the
total production cost and the cost per product:

IV. SOLVE 1. Total Production Cost: Direct Material Cost:

1. You are the operations manager of a bakery that specializes $2,600 Direct Labor Cost: $6,500 Overhead
in producing artisan bread. Over the last quarter, your team Cost: $2,100 Total Production Cost = Direct
has been busy baking a variety of bread to meet customer Material Cost + Direct Labor Cost +
demand. Throughout this period, you've diligently tracked the Overhead Cost Total Production Cost =
costs involved in the production process. The direct Material $2,600 + $6,500 + $2,100 = $11,200
Costs - Flour $2,000, Yeast: $500, and Salt: $100. Direct 2. Cost per Product: Cost per Product = Total
Labor Costs - Bakers: $4,000, Assistants: $2,000, and Quality Production Cost / Number of Units
control: $500 and the Overhead Costs - Equipment
Produced Cost per Product = $11,200 /
maintenance: $1,000, Utilities: $800, andPackaging: $300.
Throughout the quarter, your team successfully produced
10,000 = $1.12 per loaf
10,000 loaves of bread, each meticulously crafted to meet the
highest standards. To determine the selling price with a 120% profit
margin: Profit Margin = 120% = 1.2 Selling Price =
Total Production Cost + (Total Production Cost * * 24 hours * 2 machines) = 720
Profit Margin) Selling Price = $11,200 + ($11,200 * pesos/day
1.2) = $11,200 + $13,440 = $24,640
3. Yearly overhead cost for maintenance:
Maintenance and repair cost for the
Total Profit: Total Profit = Selling Price - Total
Production Cost Total Profit = $24,640 - $11,200 = high-speed printer annually = 8% of its
$13,440 initial cost Yearly Maintenance Cost =
8% of 80,000 pesos = 0.08 * 80,000 =
So, the selling price per loaf with a 120% profit 6,400 pesos
margin would be $24,640, and the total profit if all
the bread is sold would be $13,440. Thus:

1. The possible overhead cost for each

machine per document is approximately
0.073 pesos for the high-speed printer
and 0.046 pesos for the binding
machine.
2. The additional daily overhead cost for
electricity is 720 pesos.
3. The yearly overhead cost for
maintenance of the high-speed printer is
6,400 pesos.

1. Possible overhead cost for each machine

per document:
a. High-Speed Printer: Individual Eq.
Computed Cost = (Cost of equipment) /
((equipment lifespan in days) * (number
of documents produced per day))
Individual Eq. Computed Cost = 80,000 /
(5 * 365 * 600) = 80,000 / 1,095,000 =
0.073 pesos per document
b. Binding Machine: Individual Eq.
Computed Cost = (Cost of equipment) /
((equipment lifespan in days) * (number
of documents produced per day))
Individual Eq. Computed Cost = 50,000 /
(5 * 365 * 600) = 50,000 / 1,095,000 =
0.046 pesos per document
2. Additional daily overhead cost for
electricity: Electricity cost for running
both machines per day = (15 pesos/hour