Entrepreneurship Reviewer PDF

**[ENTREPRENEURSHIP REVIEWER]** **[MARKETING]** - - - - - - - - - **MOST COMMON STRATEGIES** **[Bundling]** - this refers to ***2 or more products or services in one reduced price.*** **[Penetration Pricing]** - this refers to **[setting low price to increase market s...

**[ENTREPRENEURSHIP REVIEWER]** **[MARKETING]** - - - - - - - - - **MOST COMMON STRATEGIES** **[Bundling]** - this refers to ***2 or more products or services in one reduced price.*** **[Penetration Pricing]** - this refers to **[setting low price to increase market share]**, but the entrepreneur **[will eventually increase the price once the desired market share is achieved.]** **[Skimming]** - **opposite of penetration pricing** where prices are **[initially high and then they are lowered to offer product or service to a wider market.]** **[Competitive Pricing]** - refers to **[benchmarking prices with the competitors.]** - 1. a. b. c. d. 2\. **[Public relations/ Publicity]** - through **[media coverage]** Examples of PR strategies as follows: - - - - - - 3\. **[Personal Selling]** - **[involves a salesperson]** who has personal and direct contact with the prospective customers. 4\. **[Sales Promotion]** - short-term promotional gimmicks - - - - - **[4Ms Of Production]** **[MANPOWER]** - refers to the right human resources who will handle certain business operations. **[MATERIALS]** - the input that **[must be converted to the final output.]** - **[METHOD]** - the procedure, technique or **[way of doing something especially in accordance with the definite plan.]** **[MACHINE]** - **[basic tools to produce goods]** or to generate services - **[FORECASTING REVENUES AND COSTS]** **[FORECASTING]** - aims to support management or a business owner in its desire to adjust and cope with uncertainties of the future - - **[REVENUE]** - results when sales exceed the cost to produce goods or render the services. - **[SALES]** - used especially when the nature of business is **[merchandising or retail]**, while **[SERVICE INCOME]** is used to record revenues **[earned by rendering services]**. These factors should serve as a basis for forecasting the revenues of the business. These factors are: 1. 2. 3. 4. **[MARK UP]** - amount added to the cost to come up with the selling price. The formula is as follows: - - **[FORECASTING THE COSTS TO BE INCURRED]** **[Incurred]** - an accounting term that means that **[all transactions]**, regardless of their nature, must be recorded when they occur. **[Operating Expenses]** - the business also **[incurs costs in its operation, these costs are called Operating Expenses]**. Operating Expenses such as **[payment on the internet connection, utility expenses, salaries, and wages, miscellaneous are essential in the operation of the business]**; to continue to operate in a given period of time. **[Cost of Goods Sold / Cost of Sales]** - amount of the **[merchandise or goods the business sells for a given period]**. This is computed by adding the beginning inventory to the net amount of purchases to arrive at the cost of goods available for sale from which the merchandise inventory end is subtracted. **[Merchandise inventory beginning]** - goods and merchandise at the **[beginning of operation of the business]** or accounting period. **[Merchandise inventory end]** - goods and merchandise **[left at the end of the operation]** or accounting period. **[Purchases]** - refer to the **[merchandise or goods purchased]** **[Freight-in]** - **[amount paid to transport goods or merchandise]** purchased from the supplier to the buyer. In this case, it is the buyer who shoulders the costs. COMPUTATION OF GROSS PROFIT - **[Profit]** - is the **[gross income]**. The amount of gross profit provides information to the entrepreneur about revenue earned from sales. The term **[cost]** refers to the **[purchase price]** of the product including the total outlay required in producing it. **The gross profit margin is computed as follows:** Gross Profit Rate = Gross Profit/Net Sales **[Operating Profit Margin]** - is the **[excess of gross profit]** from operating expenses. Operating Profit Margin Rate = Operating Profit Margin/Net Sales The **[income statement]** is the **[net profit margin and the third level]** in the revenue. Net Profit Margin Rate = Net Profit/Net Sales ANALYZING THE LIQUIDITY STATUS OF THE BUSINESS Liquidity Ratios Current Ratio = Current assets / Current Liabilities Quick Ratio = (Current assets -- Inventories) / Current Liabilities Current Liabilities = (Cash and Equivalents + Marketable Securities + Accounts Receivable) The **[quick ratio]** measures its **[short-term obligations]** with its most liquid assets and therefore excludes inventories from its current assets. **[Return of Investment (ROI)]** - measures the **[amount of net income per peso]** invested in the business. **The formula to compute ROI is as follows:** Return of Investment = Net Income/Average Total Assets GOOD LUCK AND GOD BLESS