organization and management - znnhs

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Republic of the Philippines Department of Education National Capital Region DIVISION OF CITY SCHOOLS – MANILA Manila Education Center Arroceros Forest Park Antonio J. Villegas St. Ermita, Manila Organization and Management Quarter 1 Week 3 Module 3 Learning Competency: Analyze the forms and economic roles of business organizations.

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Page 1: Organization and Management - ZNNHS

Republic of the Philippines

Department of Education

National Capital Region

DIVISION OF CITY SCHOOLS – MANILA Manila Education Center Arroceros Forest Park

Antonio J. Villegas St. Ermita, Manila

Organization and Management

Quarter 1 Week 3 Module 3

Learning Competency:

Analyze the forms and economic

roles of business organizations.

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HOW TO USE THIS MODULE?

Before starting the module, I want you to set aside other tasks

that will disturb you while enjoying the lessons. Read the simple instructions below to successfully enjoy the objectives of this kit.

Have fun!

1. Follow carefully all the contents and instructions indicated in every page of this module.

2. Write on your notebook the concepts about the lessons. Writing

enhances learning, that is important to develop and keep in mind.

3. Perform all the provided activities in the module. 4. Let your facilitator/guardian assess your answers using the

answer key card. 5. Analyze conceptually the posttest and apply what you have

learned. 6. Enjoy studying!

PARTS OF THE MODULE

Expectations - These are what you will be able to know after completing the lessons in the module.

Pre-test - This will measure your prior knowledge and the concepts to be mastered throughout the lesson.

Looking Back to your Lesson - This section will measure what learnings and skills did you understand from the previous lesson.

Brief Introduction- This section will give you an overview of the lesson.

Activities - This is a set of activities you will perform with a partner.

Remember - This section summarizes the concepts and applications of the lessons.

Check your Understanding - It will verify how you learned from the lesson.

Post-test - This will measure how much you have learned from the entire module

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LESSON Forms of Business Organization 4

EXPECTATIONS

As we study and immerse ourselves in “Organization and Management” in the process, it is necessary to discuss the different phases of economic and differentiate the various forms of business organizations. The module is subjected to discuss Module 3 – Forms of Business Organization.

After going through the module, you are expected to:

1. analyze the forms and economic roles of business organizations.

PRETEST

Let us start your journey in learning

thru a Pre-test. Good luck!

Fill in the Blank Directions: Choose the CORRECT word from the table being described by the statement s below and write your answer in the space provided before the number.

Partnership Single Proprietorship Corporation

Cooperative

Joint Venture General Partnership

__________________ 1. is a type of partnership which divides responsibility for management and liability, as well as the shares of profit of loss according to their internal agreement. __________________ 2. is an organization established for the purpose of purchasing and marketing the products of its member. __________________ 3. is a juridical entity established under the Corporation Code and registered with the SEC. __________________ 4. is the simplest form of business and the easiest to register through the Bureau of Trade Regulation and Consumer Protection (BTRCP). __________________ 5. consists of two or more persons who bind themselves to contribute money or industry to a common fund with the intention of dividing profits among themselves.

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LOOKING BACK TO YOUR LESSON 3

Matching-type

Directions: Match the column A to column B. Write your answer in the space provided before the number

A B

____ 1. Philippine Cooperative Code of 2008 a. Cooperative ____ 2. The purpose of purchasing and marketing b. RA 9520 the products of its members c. Joint Venture ____ 3. Mixture of the features of a sole proprietorship d. Single Proprietorship and a corporation. e. One Person Corporation ____ 4. Simplest form of business and the f. Transitional Society easiest to register.

____ 5. Acts like a general partnership but is clearly

limited period of time.

Enjoy reading…..

BRIEF INTRODUCTION

After deciding to start a business (and the business to pursue), one of the important issues is the form of business entity that will serve as the vehicle in pursuing the business. You may say that the next important issue is the source of funding, which is correct, but that issue will be discussed later. Right now, let’s focus on the forms of business.

The choice of the form of business or business organization depends on various factors. In certain business, like banks, the law requires that the business entity must be a corporation. A small business, like your friendly sari-sari store, is better off as a sole proprietorship, although it could also be converted to another form of business if the circumstances require that shift.

A. Partnership

Partnership consists of two or more persons who bind themselves to contribute money or industry to a common fund, with the intention of dividing the profits among themselves. The most common example of partnerships are professional partnerships, like in the case of law firms and accounting firms. Just like a corporation, it is registered with the Securities and Exchange Commission (SEC).

Advantages of a Partnership Partnerships are relatively easy to establish; however time should be invested in

developing the partnership agreement.

With more than one owner, the ability to raise funds may be increased.

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Learning Module for Organization and Management

The profits from the business flow directly through to the partners’ personal tax return.

Prospective employees may be attracted to the business if given the incentive to become a partner.

The business usually will benefit from partners who have complementary skills.

Disadvantages of a Partnership Partners are jointly and individually liable for the actions of the other partners.

Profits must be shared with others.

Since decisions are shared, disagreements can occur.

Some employee benefits are not deductible from business income on tax returns.

The partnership may have a limited life; it may end upon the withdrawal or death of a partner.

Types of Partnerships that should be considered:

1. General Partnership Partners divide responsibility for management and liability, as well as the shares of profit or loss according to their internal agreement. Equal shares are assumed unless there is a written agreement that states differently.

2. Limited Partnership and Partnership with limited liability “Limited” means that most of the partners have limited liability (to the extent of their

investment) as well as limited input regarding management decision, which generally

encourages investors for short term projects, or for investing in capital assets. This form

of ownership is not often used for operating retail or service businesses. Forming a

limited partnership is more complex and formal than that of a general partnership.

3. Joint Venture Acts like a general partnership but is clearly for a limited period of time or a single project. If the partners in a joint venture repeat the activity, they will be recognized as an ongoing partnership and will have to file as such and distribute accumulated partnership assets upon dissolution of the entity.

B. Sole proprietorship

Also referred to as “single proprietorship,” a sole proprietorship is the simplest form of business and the easiest to register, through the Bureau of Trade Regulation and Consumer Protection (BTRCP) of the Department of Trade and Industry (DTI). It is owned by an individual who has full control/authority of its own and owns all the assets, as well as personally answers all liabilities or losses. The fact that it is run by the individual means that it is highly flexible and the owner retains absolute control over it.

Advantages of a Sole Proprietorship a. Easiest and least expensive form of ownership to organize. b. Sole proprietors are in complete control, and within the parameters of the law,

may make decisions as they see fit. c. Profits from the business flow-through directly to the owner’s personal tax return.

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Learning Module for Organization and

Management d. The business is easy to dissolve, if desired.

Disadvantages of a Sole Proprietorship a. Sole proprietors have unlimited liability and are legally responsible for all debts

against the business. Their business and personal assets are at risk. b. May be at a disadvantage in raising funds and are often limited to using funds

from personal savings or consumer loans. c. May have a hard time attracting high-calibre employees, or those that are

motivated by the opportunity to own a part of the business. d. Some employee benefits such as medical insurance premiums are not directly

deductible from business income (only partially as an adjustment to income). C. Sole Corporation

A mixture of the features of a sole proprietorship and a corporation is found in a new entity authorized under the Revised Corporation Code — the One Person Corporation. An OPC is registered in the same manner as other corporations with the SEC, except that it is composed of only one person, just like a sole proprietorship. [See One Person Corporations under the Revised Corporation Code] D. Corporation

A corporation is a juridical entity established under the Corporation Code and

registered with the SEC. It must be created by or composed of at least 5 natural persons up to a maximum of 15, technically called “incorporators” (the 5-person minimum has been removed under the Revised Corporation Code). Juridical persons, like other corporations or partnerships, cannot be incorporators, although they may subsequently purchase shares and become corporate shareholders/stockholders. .

Advantages of a Corporation

a. Shareholders have limited liability for the corporation’s debts or judgments

against the corporation. b. Generally, shareholders can only be held accountable for their investment in

stock of the company. (Note however, that officers can be held personally liable for their actions, such as the failure to withhold and pay employment taxes.

c. Corporations can raise additional funds through the sale of stock. d. A Corporation may deduct the cost of benefits it provides to officers and employees. e. Can elect S Corporation status if certain requirements are met. This election

enables company to be taxed similar to a partnership.

Disadvantages of a Corporation

a. The process of incorporation requires more time and money than other forms of

organization. b. Corporations are monitored by federal, state and some local agencies, and as a

result may have more p c. Paperwork to comply with regulations. d. Incorporating may result in higher overall taxes. Dividends paid to shareholders

are not deductible from business income; thus this income can be taxed twice.

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E. Cooperative

A cooperative is an organization established for the purpose of purchasing and marketing the products of its members, i.e., shareholders, and/or procuring supplies for resale to the members, whose profits are distributed to the members (in the form of patronage dividends), not on the basis of the members' equity

According to REPUBLIC ACT 9520 also known as "Philippine Cooperative Code of 2008".

The primary objective of every cooperative is to help improve the quality of life of its members. Towards this end, the cooperative shall aim to:

a. Provide goods and services to its members to enable them to attain increased income, savings, investments, productivity, and purchasing power, and promote among themselves equitable distribution of net surplus through maximum utilization of economies of scale, cost-sharing and risk-sharing; b. Provide optimum social and economic benefits to its members; c. Teach them efficient ways of doing things in a cooperative manner; d. Propagate cooperative practices and new ideas in business and management; e. Allow the lower income and less privileged groups to increase their ownership in the wealth of the nation; and f. Cooperate with the government, other cooperatives and people-oriented organizations to further the attainment of any of the foregoing objectives.

ACTIVITIES

Activity 1: Independent Activity

In 5 to 8 sentences, discuss in a yellow paper how learning this lesson can improve your relationship with the people around you, your parents, guardians, or family. Ask an elder at home to comment on your answers.

__________________________________________________________________________________________ __________________________________________________________________________________________ __________________________________________________________________________________________ __________________________________________________________________________________________ __________________________________________________________________________________________ _________________________________________________________________________________________

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Activity 2: Independent Activity

Directions: Give your own descriptions on the various forms of business organizations in 3

to 5 sentences only. Write your answer in the space provided in bullet form.

To discuss Answer

1. Sole proprietorship

2. Partnership

3. Corporation

4. Cooperative

REMEMBER 9

Walk Whitman Rostow, also known as W.W. Rostow was an economist in the Lyndon B. Johnson

administration from 1966-1969. He also published articles and developed models on economic development.

The Five Stages of Economic Development model is developed by Walt Withman Rostow. The five stages are 1) Traditional Society, 2) Preconditions for Take-off, 3) Take-Off, 4) Drive to maturity, and 5) Age of Mass Consumption.

Partnership consist of two or more persons who bind themselves to contribute money or industry to a common fund, with the intention of dividing the profits among themselves.

Types of partnership are 1) General Partnership, 2) Limited Partnership and Partnership with limited liability, and 3) Joint Venture.

Sole proprietorship is the simplest form of business and the easiest to register, through the Bureau of

Trade Regulation and Consumer Protection (BTRCP) of the Department of Trade and Industry (DTI). It is

owned by an individual who has full control/authority of its own and owns all the assets, as well as

personally answers all liabilities or losses.

Corporation is a juridical entity established under the Corporation Code and registered with the SEC. Cooperative is an organization established for the purpose of purchasing and marketing the products or its

members, i.e., shareholders, and/or procuring supplies for resale to the members, whose profits are distributed to the members (in the form of patronage dividends), not on the basis of the members’ equity.

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CHECK YOUR UNDERSTANDING

Multiple Choice Directions: Read the questions carefully and encircle the letter of the correct answer. Write your answer in a yellow paper.

1. Which of the following is a form of business which has unlimited liability. Creditors may

proceed not only against the assets and property of the business, but also after the

personal properties of the owner. a. Corporation b, Sole Corporation c. Partnership d. Sole proprietorship

2. Philippine Cooperative Code of 2008 is under of what Republic Act?

a. RA 9521 b. RA 9520

c. RA 9522 d. RA 9250

3. When the preconditions for take-off are met, a society can take off.

a. Drive to Maturity b. Take-off

c. Traditional Society d. None of the above

4. It acts as a general partnership but is clearly for a limited period or a single project.

Which of the following is CORRECT answer? a. General Partnership b. Limited Partnership c. Joint Venture d. None of the above

5. In which a type of partnership that divides responsibility for management and liability, as well as the shares of profit or loss according to their internal agreement.

a. General Partnership b. Limited Partnership c. Joint Venture

d. None of the above

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POST-TEST

MULTIPLE CHOICE: Choose the letter of the correct answer. Write your answer in the space provided.

____1. The followings are the disadvantages of Corporation except ONE. a. Incorporation requires more time and money that other forms of organization. b. Monitored by federal, state and some local agencies. c. May result in higher overall taxes. d. May deduct the cost of benefits it provides to offices and employees.

____2. Which of the following is advantage of Corporation? a. Can raise additional funds through the sale of stock. b. Requires more time and money than other forms of organization. c. Processes of paperwork to comply with the regulation. d. All of the above

____3. Which of the following is CORRECT about Sole Proprietorship? a. Not easiest and highly expensive form of ownership to organize. b. The business is easy to dissolve, if desired. c. Cannot control within the parameters of the law. d. Profits from the business are divided into the employees.

____4. The following are the advantages of partnership except ONE. a. The Business usually will benefit from partners who have complementary skills. b. With more than one owner, the ability to raise funds may be increased. c. Partners are jointly and individually liable for the actions of the other partners. d. Prospective employees may be attracted to the business if given the incentive

to become partner.

____5. It means that most of the partners have limited liability, as well as limited input regarding management decision.

a. Abundant b. Unlimited c. Single d. Limited

____6. Which of the following are disadvantages of Sole Proprietorship? a. Have limited liability and are legally responsible for all debts against the

business. b. Some employees benefits such as owner’s medical insurance premiums are

not directly deductible from business income c. Have a hard time attracting high-caliber employees d. All of the above

____7. It is registered in the same manner as other corporations with the SEC, except that it is composed of only one person, just like a sole proprietorship.

a. One Person Corporation b. Partnership c. Double Person Corporation d. Cooperative

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____8. Republic Act 9520 also known as: a. Philippine Cooperative Code of 2008 b. Philippine Cooperative Code of 2009 c. Philippine Corporation Code of 2008 d. Philippine Corporation Code of 2009

____9. The following are the objectives and Goals of a Cooperative except ONE. a. Provide good and services to its members to enable them to attain increase

income, savings, investments and purchasing power. b. Allow the higher income and higher privileged group to increase their

ownership in the wealth of the nations. c. Teach them efficient ways of doing things in a cooperative manner. d. Provide optimum social and economic benefits to its members.

____10. SEC stands for: a. Securities and Exchange Corporation b. Security and Exchange Commission c. Securities and Exchange Commission d. Security and Exchange Corporation

REFLECTIVE LEARNING SHEETS

Reflective Question: If you have an existing sari-sari store, what are the possible things you will consider in terms of business registration based on the topic discussed to respond to the COVID-19 pandemic? Cite at least two and explain. Write your answer in the space provided.

__________________________________________________________________________________________ __________________________________________________________________________________________ __________________________________________________________________________________________ __________________________________________________________________________________________ __________________________________________________________________________________________ __________________________________________________________________________________________ __________________________________________________________________________________________ __________________________________________________________________________________________ _________________________________________________________________________________________

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REFERENCES

Books Darr, K. (2013). Introduction to Management and Leadership Concepts, Principles and Practices, Jones and Bartlett Learning, Retrieved from: https://www.google.com.et Mintzberg, H. (1989). MINTZBERG ON MANAGEMENT. Reprinted by permission of Free Press, a division of Simon & Schuster, Inc. Robbins, S., Robbins, S. P. and Coulter, M. (2012). Management -11th ed, Pearson. Retrieved from: www.pearsonhighered.com

Websites Smyth, D. (2019). The Roles of Business Organizations in Economic Development. Retrieved from:https://bizfluent.com/info-7745795-roles-business-organizations-economic-development.html https://www.managementstudyhq.com/functions-of-management.html

https://www.slideshare.net/LalaineCazar/nature-and-concept-of-

management?from_action=save https://www.wisdomjobs.com/e-university/principles-of-management-and-organisational-behaviour-tutorial-366/evolution-of-management-thought-12679.html https://www.mindtools.com/pages/article/management-roles.htm https://study.com/academy/lesson/five-stages-of-economic-development.html https://pnl-law.com/blog/forms-of-business-sole-proprietorship-partnership-corporation/ https://www.cda.gov.ph/resources/issuances/philippine-cooperative-code-of-2008/republic-act-9520 https://bizfluent.com/info-7745795-roles-business-organizations-economic-development.html https://www.freepik.com/free-vector/team-leader-managing- project_5562411.htm#page=1&query=manager in business management position=4 https://www.freepik.com/free-vector/urban-buildings-with-cityscape- scenery_4794860.htm#page=1&query= BUSINESS ENVIRONMENT position=33 https://www.freepik.com/premium-vector/business-people-communicating-office-banner_5523082.htm#page=1&query= BUSINESS ENVIRONMENT position=22 https://www.freepik.com/free-vector/scrum-team-discussing-

tasks_4950291.htm#page=1&query=ROLE OF BUSINESS position=6

https://www.freepik.com/free-vector/professional-group-working-

project_4950283.htm#page=1&query=ROLE OF BUSINESS position=11

https://www.investopedia.com/terms/c/corporation.asp https://u.osu.edu/coopmastery/legal/alternative-business-structures/

Acknowledgements

Development Team of the Module

Writers: Mamerto T. Goneda, MSIT Jupiter Q. Whiteside, MBA Farida F. Tallud, DBM

Editor: Isabel A. Gumaru, DBA

Evaluator: Ellaine I. Dela Cruz, DBA

Validators & Reviewer: Remylinda T. Soriano, EPS, Math Angelita Z. Modesto, PSDS George B. Borromeo, PSDS

Management Team: Maria Magdalena M. Lim – Schools Division Superintendent – Manila Aida H. Rondilla – Chief Education Supervisor Lucky S. Carpio – EPS in Charge of LRMS Lady Hannah C. Gillo, Librarian II - LRMS

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ANSWER KEY

PRETEST

1. General Partnership 2. Cooperative 3. Corporation 4. Single Proprietorship 5. Partnership

Activities Activity 1: Independent Activity Sample suggested answer: This topic helps me to appreciate the roles played by every institution in the community, big or small organization-public or private. It can create an impact on the business and to the people in it, including but not limited to the owners, management, staff, and the community itself. This way, I realize that my parents, siblings, and other family members are essential too. Their presence helps us do better with what we do in school and the community. Rubrics: 4 Expert – Piece is extraordinary, and very informative and well organized 3 Accomplished – Piece has an interesting style, and somewhat informative and organized. 2 Capable – Piece has little style, gives some new information but poorly organized. 1 Beginner - Piece has no style and, and gives no new information and very poorly organized

Activity 2: Independent Activity Rubrics:

To discuss Answer

1. Sole proprietorship is a type of enterprise that is owned and run by

one person and in which there is no legal distinction between the owner and the business

entity. A sole trader does not necessarily work

'alone'—it is possible for the sole trader to employ other people.

e sole trader receives all profits (subject to taxation specific to the business) and has unlimited responsibility for all losses and debts. Every asset of the business is owned by the proprietor and all debts of the business are the proprietor's. It is a "sole" proprietorship in contrast with partnerships (which have at least two owners). A sole proprietor may use a trade name or business name other than their or its legal name. They may have to legally trademark their business name if it differs from their own legal name, the process varying depending upon

country of residence.12

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2. Partnership is an arrangement where parties, known as business partners, agree to cooperate to advance their mutual interests. The partners in a partnership may be

individuals, businesses, interest-

based organizations, schools, governments or combinations. Organizations may partner to increase the likelihood of each achieving their mission and to amplify their reach. A partnership may result in issuing and holding equity or may be only governed by a contract.

3. Corporation is a legal entity that is separate and distinct from its owners. Corporations enjoy most of the rights and responsibilities that individuals

possess: they can enter contracts, loan and borrow money, sue and be sued, hire employees, own assets, and pay taxes. Some refer to it as

a "legal person."

4. Cooperative is a business owned and operated by those who use its services. Although cooperatives are for- profit businesses, they do not exist to maximize profit. The goal of a cooperative is to fill a mutual need of the members that own the business.

4 Expert – Piece is extraordinary, and very informative and well organized 3 Accomplished – Piece has an interesting style, and somewhat informative and organized. 2 Capable – Piece has little style, gives some new information but poorly organized. 1 Beginner - Piece has no style and, and gives no new information and very poorly organized

Check your Understanding Multiple Choice

1. D 2. A 3. B 4. C 5. A

Post-test . 1. B 2. D 3. B 4. C 5. D 6. D 7. A 8. A 9. B 10. C 13