7/8

NAME:________________________________________
GRADE/SECTION:_____________________________
_

TLE-Cookery
Quarter 0 – Week 5
Calculating Cost of
Production

CONTEXTUALIZED LEARNING ACTIVITY SHEETS

SCHOOLS DIVISION OF PUERTO PRINCESA CITY
TLE – Cookery - Grade 7/8
Contextualized Learning Activity Sheets (CLAS)
Quarter 0 – Week 5: Calculating Cost of Production
First Edition, 2020

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Published by the Schools Division of Puerto Princesa City

Development Team of the Contextualized Learning Activity Sheets

Writer: Rodalline E. Tabangay

Content Editor: Jocelyn E. Pacanza

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Reviewer: Dennis M. Lucas, PhD

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Layout Artist: Rodalline E. Tabangay

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Sta. Monica Heights, Brgy. Sta. Monica, Puerto Princesa City
Telephone No.: (048) 434 9438
Email Address: puertoprincesa@deped.gov.ph
 Lesson 1
Calculating Cost of Production

Learning Competency:

LO2. Calculate Cost of Production. TLE_HECK7/8PM-0e-5

Objectives:
1. Discuss principles of costing
2. Compute peso markup, percentage markup and cost of production
3. Appreciate the importance of calculating the cost of production

Let’s Try
Directions: Read each question carefully. Write the letter of the correct answer on the space
provided before the number.

________1. What is the difference between how much an item costs or the amount added to
the cost price of goods to cover overhead and profit?
A. Expenses B. Markup C. Profit D. Selling Price

________2. What do you call a financial gain, especially the difference between the amount
earned and the amount spent in buying, operating, or producing and how much
you sell that item?
A. Expenses B. Markup C. Profit D. Selling Price

________3. In calculating peso markup by buying price and selling price. What
mathematical operation will you use to attain the peso markup?
A. Addition B. Division C. Multiplication D. Subtraction

________4. What will you do if you want to calculate percentage markup based on cost?
A. By adding the peso markup with the cost
B. By subtracting the peso markup with the cost
C. By multiplying the peso markup with the cost
D. By dividing the peso markup with the cost

________5. Ryler wants to put a food business, what must he do to calculate his percentage
markup based on the selling price?
A. He must add the peso markup by the selling price.
B. He must subtract the peso markup by the selling price.
C. He must multiply the peso markup by the selling price.
D. He must divide the peso markup by the selling price.

For #6-10 Answer the questions that follow based on the given formation on the table.
Choose the letter of the best answer. Circle the letter of your answer.

1
 Items Purchase Selling Price
Cost/Buying Price
Sapin-Sapin 25.00 40.00
Banana Que 8.00 13.00
Moron 10.00 15.00
Karyoka 5.00 10.00
Siopao 15.00 25.00

________6. How much is the peso markup of sapin-sapin?

A. 5 B. 10 C. 15 D. 20

________7. Adrian wants to start his banana que business. From the table above, how
much will his peso markup be?
A. 5 B. 7 C. 9 D. 11

________8. Christine has a moron business, how much will her peso markup be?
A. 5 B. 7 C. 9 D. 11

________9. How much will the peso markup of karyoka be?

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

________10. Mrs. R has a siopao stall, from the table above, how much will the peso
markup of each siopao be?
A. 5 B. 10 C. 15 D. 20

Let’s Explore and Discover

Have you tried to sell yema, sampalok, banana que, candies etc. during your
elementary days?

How did come up with the price of each item? Did you also gain profit? Or nothing?

The price varies with the quality, climate and either the location of the business.

Money or capital, machinery or equipment and physical facilities are the resources to
use.

Food products is either for domestic consumption or commercial purposes.

Unlocking of Difficulties
 Price is the amount of money that an entrepreneur sets for the items or products
for sale.
 Production the process of manufacturing raw materials for consumption..

2
How to Calculate Markup Percentage
Markup is the difference between how much an item costs you, and how much you sell
that item for--it's your profit per item. Any person working in business or retail will find the
skill of being able to calculate markup percentage very valuable.
Instructions
1. Calculate your peso markup. This is done by subtracting your buying price from your
selling price.

Formula: Selling Price(SP) – Purchase Cost(PC) = Peso Markup(PM)

Example:
Selling Price 15.00
Purchase Cost/Buying Price - 10.00
Peso Markup 5.00

2. Decide whether you want to calculate your percentage markup based on cost or
selling price. Once you choose which one you will be using to calculate, it is important
that you stick with the method you chose throughout all your calculations, or you will
end up with faulty data. If you decide to calculate your percentage markup based on
cost, go to Step 3. If you decide to calculate your percentage markup based on selling
price, go to Step 4.

3. Calculate percentage markup based on cost. This is done by dividing the peso markup
by the cost.

Formula: Peso Markup(PM) ÷ Purchase Cost(PC) = Percentage Markup(%M)

Example
Peso Markup 5.00
Purchase Cost/Buying Price ÷ 10.00
Percentage Markup .5 or 50%

4. Calculate your percentage markup based on selling price. This is done by dividing the
peso markup by the selling price.

Formula: Peso markup(PM) ÷ Selling price(SP) = Percentage markup(%M)

Example
Peso Markup 5.00
Selling Price ÷ 15.00
Percentage markup .33 or 33%

5. Make sure you consistently use either cost of the product or selling price to find the
percentage markup on an item. Even though the cost, selling price, and peso markup
will always be the same, the percentage markup will be drastically different depending
on if you calculate it using selling price or cost. Using selling price will give you a lower
percentage markup (assuming you are making a profit) while using cost will give you
a higher percentage markup.

(Source: K to 12 Basic Education Curriculum TLE-Commercial Cooking Exploratory Course

Grade 7/8 Learning Module, Department of Education; 2016, 49-52)

3
 Compute Cost of Production
The goods/products prices are vary from one place to another. Selling of
goods/product at the lowest price can gain more customer, but may have low profit at the
same time. So it is important to compute the cost of production.

For today’s lesson, you need to know how to compute for the selling price of a recipe
and how to impose a peso markup.

Way to compute for the selling price of each recipe is by using the formula.

TE + ½ TE
SP = ----------------------

Y
Where: SP = Selling Price
TE = Total Expenses

Y = Yield (number of serving or pieces)

Suppose you are a food entrepreneur who wants to compute for the selling price of fried
chicken. It has 10 servings and you want to impose a 20% markup.

Items Unit Cost Total Cost Markup Selling Price

1 kl chicken wings 150/kl 150

2 packs breading mix 25/pack 50
1 bot. cooking oil 25/bot. 25
Total = 225 40 26.5

1. To determine the total cost, just multiply the unit cost with the item quantity. Then
add all the subtotal of each item to gain the total cost or total expenses.
Chicken 150.00 x 1 = 150.00
Breading mix 25.00 x 2 = 50.00
Cooking Oil 25.00 x 1 = + 25.00
225.00 – total expenses
2. To determine the markup, multiply the total cost or total expenses with the imposed
markup percentage.
PHP 225.00 – total expenses
x 0.20 – 20% impose markup percentage
PHP 45.00 – markup or profit

3. To compute for the selling price, add the PHP 45.00 markup to the total expenses.
PHP 225.00
+ 45. 00
PHP 270.00 – selling price for 10 servings

4. To compute for the retail price of the given recipe, divide selling price by the number
of servings or yields.
PHP 270.00
----------------- = PHP 27.00 per serving
10. 00

(Source: “Production Cost Formula.” Dreeraj Vaidya’s page, accessed September 25, 2020,
https://www.wallstreetmojo.com/production-cost-formula.)

4
 Let’s Practice

Directions: Write the True if the statement is corret and False if it is incorrect. Write your
answer on the space provided before each number.
A B
1. Production is the process of manufacturing raw materials for
consumption.
2. Markup is the difference between how much an item costs you
and how much you sell that item.
3. To calculate your peso markup you need to add your buying
price from your selling price.
4. Multiplication is used in calculating percentage markup based
on selling price.
5. Division is used in calculating percentage markup based on cost.

Directions: Complete the following table. Compute for the Peso Markup.
Items Purchase Selling Price Peso Markup Percentage
Cost/Buying Price Markup
Hopia 5.00 8.00 60%
Banana cake 7.00 10.00 43%
Yema 3.00 5.00 67%
Halayang Ube 55.00 75.00 27%
Buko Salad 80.00 100.00 20%

As a student, why it is important to have knowledge on the principles of costing?

_________________________________________________________________________________________
____________________________________________________________________________________

Let’s Do More

Directions: Complete the following table. Compute for the Percentage Markup. Use #3
instruction for Siomai, Squid Ball and Burger. And, use #4 instruction for Milktea and Pansit
Items Purchase Selling Peso Percentage
Cost/Buying Price Price Markup Markup
Siomai 5.00 8.00 3.00
Squid Ball 3.00 5.00 2.00
Burger 20.00 25.00 5.00
Milktea 50.00 75.00 25.00
Pansit 15.00 20.00 5.00
5
Directions: Given the following recipe (Puto) and its estimated cost, compute for the total
cost and impose a 50% markup to determine the selling prices of your product. Total Yields
of 30 pieces.

Total
Items Unit Cost Markup Selling Price
Cost
40.00/kl
1 cup All-Purpose Flour
Approx. 4 cups/kl
50.00/kl
½ cup white sugar
Approx. 4 cups/kl
15.00/pack
1 tbsp Baking Powder
Approx.15tbsp/pack
50.00/bar
1 tbsp Melted Butter
Approx. 25 tbsp/bar
½ cup Evaporated 25.00/can
Milk Approx. 1 cup/can
1 pc egg 10.00/pc
1 tsp Vanilla 10.00/bottle
Approx. 10tsp/bottle
60.00/bar
½ cup cheese, Strips Approx. 1 cup/bar
Total =

In your everyday life, why do we need to learn how to calculate the total cost and selling
price using the imposed markup or using the formula?
_________________________________________________________________________________________
_____________________________________________________________________________________

Let’s Sum It Up
Directions: Given the following recipe (Maja Blanca) and its estimated cost, compute for
the total cost and impose a 50% markup to determine the selling price of your product.
Total serving of 24 slices.

Items Unit Cost Total Cost Markup Selling Price

2 cups cornstarch 20.00
2 cups white sugar 25.00
7 cups cocomilk 50.00
1 cup evaporated milk 20.00
½ cup shredded buko 25.00
1 tsp vanilla 5.00
Total =

6
 Let’s Asses
A. For #1-5 Answer the questions that follow based on the given formation on the table.
Choose the letter of the best answer. Circle the letter of your answer.
Items Purchase Selling Price
Cost/Buying Price
Sapin-Sapin 25.00 40.00
Banana Que 8.00 13.00
Moron 10.00 15.00
Karyoka 5.00 10.00
Siopao 15.00 25.00

________1. How much is the peso markup of sapin-sapin?

A. 5 B. 10 C. 15 D. 20
________2. Adrian wants to start his banana que business. From the table above, how
much will his peso markup be?
A. 5 B. 7 C. 9 D. 11
________3. Mrs. R has a siopao stall, from the table above, how much will the peso
markup of each siopao be?
A. 5 B. 10 C. 15 D. 20

________4. Christine has a moron business, how much will her peso markup be?
A. 5 B. 7 C. 9 D. 11
________5. How much will the peso markup of karyoka be?
A. 2 B. 3 C. 4 D. 5
B. Directions: Read each question carefully. Write the letter of the correct answer on the
space provided before the number.
________6. What is the difference between how much an item costs or the amount added to
the cost price of goods to cover overhead and profit?
A. Expenses B. Markup C. Profit D. Selling Price
________7. What do you call a financial gain, especially the difference between the amount
earned and the amount spent in buying, operating, or producing and how much
you sell that item?
A. Expenses B. Markup C. Profit D. Selling Price
________8. Ryler wants to put a food business, what must he do to calculate his percentage
markup based on the selling price?
A. He must add the peso markup by the selling price.
B. He must subtract the peso markup by the selling price.
C. He must multiply the peso markup by the selling price.
D. He must divide the peso markup by the selling price
________9. What will you do if you want to calculate percentage markup based on cost?
A. By adding the peso markup with the cost
B. By subtracting the peso markup with the cost
C. By multiplying the peso markup with the cost
D. By dividing the peso markup with the cost
________10. In calculating peso markup by buying price and selling price. What
mathematical operation will you use to attain the peso markup?
A. Addition B. Division C. Multiplication D. Subtraction

7
 Answer Key

Let’s Try
1. B 3. D 5. D 7. A 9. D
2. C 4. D 6. C 8. A 10. B

Let’s Practice Let’s Do More

1. 3.00 1. 60%
1. True
2. True 2. 3.00 2. 67%
3. False 3. 2.00 3. 25%
4. False 4. 20.00 4. 33%
5. True 5. 20.00 5. 25%

Let’s Do More Let’s Sum It Up

145 + 72.5
Item Total Cost SP = ---------------------
APF 10.00 24
Sugar 6.25 217.4
Baking Powder 1.00 SP = -------------------
Melted Butter 2.00 24
Evap Milk 12.50
Egg 10.00 SP = 9.06
Vanilla 1.00
Cheese + 30.00
PHP 72.75
Let’s Assess
72.75+36.4 Let’s Assess
SP = ---------------------
30 Let’s Assess 1. C 6. B
2. A 7. C
109.15 3. B 8. D
SP = ------------------- 4. A 9. D
30 5. D 10,D
SP = 3.6

References

Module
K to 12 Basic Education Curriculum TLE-Commercial Cooking Exploratory Course
Grade 7/8 Learning Module, Department of Education, 2016.

Website
“Production Cost Formula.” Dreeraj Vaidya’s page, accessed September 25,
2020, https://www.wallstreetmojo.com/production-cost-formula.

8
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