SCHOOL
& SECTION
TEACHER
DATE &
TIME
I. OBJECTIVES
A. Content Standards
B. Performance Standards
C. Learning Competencies/
Objectives
Write the LC code for each
II. CONTENT
III. LEARNING RESOURCES
A. References
1. Teacher’s Guide pages
2. Learner’s Materials pages
3. Textbook pages
4. Additional Materials from
Learning Resource (LR) portal
5. Other Learning Materials
IV. PROCEDURES
vious lesson or presenting the new lesson
purpose for the lesson
C. Presenting
examples/instances of the
new lesson
D. Discussing new concepts
and practicing new skills
#1
E. Discussing new concepts
and practicing new skills
#2
GRADE LEVEL
LEARNING AREA GENERAL MATHEMATICS
QUARTER
The learner demonstrates understanding of basic concepts of business and consumer loans.
The learner is able to decide wisely on the appropriateness of business or consumer loan and its proper utilization.
At the end of the lesson, the learner should be able to:
1. Illustrates business and consumer loans. (M11GM-IIf-1)
2. Distinguishes between stocks and bonds. (M11GM-IIf-2)
3. Solve problems involving business and consumer loans (amortization, mortgage). (M11GM-IIf-3)
Basic Business Mathematics
pp. 225-226
CHED.GOV.PH K-12 Teacher's Resource Community
Powerpoint presentation, activity sheets
Cooperative Learning, Problem-Based
Discuss with the students past lesson on paying your loan with regular payments on regular intervals of time. Give some
examples on real life situation where they can apply this in business loans and consumer loans like car loan, housing
loan, SSS and GSIS salary loan, credit card cash loan and others. Tell the students that once they get a loan, they
should fulfill their obligation by paying regularly.
Discuss the following examples.
(a) Mr. Apolto decided to buy a house and lot for his family. The loan amounts to P2,500,000. He amortized the loan by
paying P23,000 monthly for 20 years.
(b) Ms. Salceda bought a car for P800,000. After deducting the down payment, her total loan amounts to P750,000. She
amortized the loan by paying P18,000 monthly for 5 years.
(c) Mr. Francisco applied for a salary loan from his social security insurance. He got a P20,000 loan. To pay for this loan,
he has to pay P1,100 monthly for 2 years.
Defonition of terms:
Amortization Method - method of paying a loan (principal and interest) on installment basis, usually of equal amounts at
regular intervals
Mortgage - a loan, secured by a collateral, that the borrower is obliged to pay at specified terms.
Chattel Mortgage - a mortgage on a movable property
Collateral - assets used to secure the loan. It may be a real-estate or other investments
Outstanding Balance - any remaining debt at a specified time
Discuss the basics of a mortgage loan to the students.
A mortgage is a business loan or a consumer loan that is secured with a collateral. Collaterals are assets that can
secure a loan. If a borrower cannot pay the loan, the lender has a right to the collateral. The most common collaterals are
real estate property. For business loans, equipment, furniture and vehicles may also be used as collaterals. Usually, the
loan is secured by the property bought. For example, if a house and lot is purchased, the purchased house and lot will be
used as a mortgaged property or a collateral. During the term of the loan, the mortgagor, the borrower in a mortgage, still
has the right to possess and use the mortgaged property. In the event that the mortgagor does not make regular
payments on the mortgage, the mortgagee or the lender in a mortgage can repossess the mortgaged property. The most
common type of mortgage is the fixed-rate mortgage wherein the interest remains constant throughout the term of the
loan.
Solve problems involving business or consumer loans
EXAMPLE 1. Mr. Garcia borrowed P1,000,000 for the expansion of his business. The effective rate of interest is 7%. The
loan is to be repaid in full after one year. How much is to be paid after one year?
An amount of P1,070,000 must be paid after one year.

EXAMPLE 2. (Chattel mortgage). A person borrowed P1,200,000 for the purchase of a car. If his monthly payment is
P31,000 on a 5-year mortgage, find the total amount of interest.
Solution:

The mortgage amount is P2,400,000.

EXAMPLE 3. If a house is sold for P3,000,000 and the bank requires 20% down payment, find the amount of the
mortgage.

The mortgage amount is P2,400,000.

EXAMPLE 4. Ms Rosal bought a car. After paying the downpayment, the amount of the loan is P400,000 with an interest
rate of 9% compounded monthly. The term of the loan is 3 years. How much is the monthly payment?
Solution:

The regular payment is P12,719.89.

Discuss the outstanding balance of a loan.

Outstanding Balance Recall that the outstanding balance of a loan is the amount of the loan at this time. One method to
compute the outstanding balance is to get the present value of all remaining payments. This method is called the
prospective method.
Time Diagram:

EXAMPLE 5. Mrs. Se borrowed some money from a bank that offers an interest rate of 12% compounded monthly. His
monthly amortization for 5 years is P11,122.22. How much is the outstanding balance after the 12th payment?
Solution:

The outstanding balance is P422,354.73.

Discuss the basics of loan amortization (compute the interest and principal components of a loan.)

EXAMPLE 6. Mr. and Mrs. Banal purchased a house and lot worth P4,000,000. They paid a down payment of P800,000.
They plan to amortize the loan of P3,200,000 by paying monthly for 20 years. The interest rate is 12% convertible
monthly.
a. How much is the monthly payment?
b. What is the total interest paid?
c. What are the principal and interest components of the 51st payment?
Solution.

There are 240 payments of P35,234.76. The total payment is 240 × P35, 234.76 = P8, 456, 342.40.
The principal is only P3,200,000.
Interest Amount = (Total Payments) ? (Principal) = 8, 456, 342.40 ? 3, 200, 000 = 5, 256, 342.40
The interest amount is P5,256,342.40

Note: Students may be surprised to learn that much of what is being paid is for the interest. This is particularly true if a
loan is being paid over a long period of time.

Find: principal and interest components of the 51st payment

The 51st payment of P35,234.76 is partly used to pay for the principal, and partly to pay for the interest.
Step 1: Get the outstanding balance after the 50th payment (the balance after the 50th payment is what the 51st payment
will be for).
Since 50 payments have been paid already, there will be 190 remaining payments.
The outstanding balance after the 50th payment is:

Step 2: After the 50th payment, the outstanding balance is P2,991,477.63.

Since the interest rate per period is j = 0.01, then the remaining balance of P2,991,477.63 will be charged an interest of
The 51st payment of P35,234.76 will be used to pay for this interest. Thus, the interest component of the 51st payment is
P29,914.78.

Thus, for the 51st payment, the part that goes to pay the interest is P29,914.78 and the part that goes to pay the principal
is P5,319.98.
 Seatwork 1. A loan of P200,000 is to be repaid in full after 3 years. If the interest rate is 8% per annum. How much
should be paid after 3 years? Answer: F = (1 + j)n = 100, 000, (1 + 0.08)3 = 251, 942.40
Seatwork 2. For a purchase of a house and lot worth P3,800,000, the bank requires 20% down payment, find the
mortgaged amount. Answer: P3,040,000
Seatwork 3. A car dealer offers a 15% down payment for the purchase a car. How much is the mortgaged amount if the
cash value of the car is P1,500,000? Answer: P1,275,000
Seatwork 4. If a condominium is purchased for P5,700,000 and the bank requires 30% down payment, how much is the
mortgaged amount? Answer: P3,990,000
Seatwork 5. A family obtained a P1,000,000 mortgage. If the monthly payment is P38,000 for four years, how much is
the total interest paid? Answer: P824,000
Seatwork 6. Mr. Canlapan obtained a 10-year mortgage for P4,200,000. If his monthly payment is P39,500 , how much
F. Developing Mastery is the total interest? Answer: P540,000
Seatwork 7. Mr. Ramos is considering to pay his outstanding balance after 3 years of payment. The original amount of
the loan is P100,000 payable annually in 5 years. If the interest rate is 10% per annum and the regular payment is
P26,379.75 annually, how much is the outstanding balance after the 3rd payment?
Seatwork 8. Ms. Saya got a business loan worth P900,000. She promised to pay the loan semi-annually in 3 years. The
semi-annual payment is P183,026.37 if money is worth 12% converted semi-annually. How much is the outstanding
balance after the first payment?
Seatwork 9. A consumer loan worth P30,000 is to be repaid in 12 months at 9% convertible monthly. How much is the
monthly payment?
Seatwork 10. A business loan worth P750,000 is to repaid in quarterly installment in 2 years. How much is the quarterly
payment if money is worth 8% converted quarterly?
Problem-based Approach and Collaborative Learning
Group the students into 5. Interview a real estate agent, vehicle dealer or someone who sells by installment. Get a
sample of the quotation for what they are selling. Make sure the following details will be reported to class:
G. Finding practical i. Cash Value of the property
applications of concepts ii. Down payment
and skills in daily living iii. Mortgaged Amount
iv. Term of the Loan v. Monthly Payment
v. Total Interest

H. Making generalizations and It’s THINK TIME! Call several students to ask questions regarding the lesson and let them call their classmates to answer
abstractions about the their question.
lesson
A. Fill in the blank.
1. A ________ is a loan, secured by a collateral, that the borrower is obliged to pay at specified terms.
Answer: mortgage
2. _______ is a mortgage on a movable property. Answer: chattel mortgage
3. A ________ is a mortgage with a fixed interest rate for its entire term. Answer: fixed-rate mortgage
4. The ________ is the lender in a mortgage. Answer: mortgagee
5. The ________ is the borrower in a mortgage. Answer: mortgagor
B. Solve the following problems completely.
1. A business loan of 800,000 is to be repaid in full after 2 years. What is the amount to be paid if the
effective rate of interest is 8%? Answer: F =P(1+j)n =800,000(1+0.08)2 =933,120
2. For the purchase of a farm worth P2,800,000, the bank requires 30% down payment, find the mortgaged
amount. Answer: P1,960,000
3. If a condominium is purchased for P1,700,000 and the bank requires 25% down payment, how much is
the mortgaged amount? Answer: P1,275,000
4. Mr. Sia got a P1,100,000 mortgage. If the monthly payment is P33,000 for five years, how much is the
total interest paid? Answer: P880,000
5. Mr. Yuson obtained a 20-year mortgage for P2,200,000. If his monthly payment is P18,500 , how much
I. Evaluating learning is the total interest? Answer: P2,240,000
C. Answer the following problems completely.
1. Mr. Abaya got a P700,000 loan for the expansion of his business payable monthly in 4 years. How much
is the monthly amortization if the interest rate is 12% compounded monthly?
2. A consumer loan of P300,000 is to be repaid quarterly for 5 years. If the interest rate is 10% converted
quarterly, How much is the quarterly payment?
3. A business loan of P650,000 is to be settled by paying P29,994.20 monthly in 2 years. If the interest rate
is 10% converted monthly, how much is the outstanding balance after 6 payments?
4. Ms. Sena got a P500,000 loan to be repaid quarterly in 5 years. The interest rate applied is 10%
convertible quarterly. The quarterly payment is solved as P32,073.56. How much is the outstanding
balance after 2 years?
5. A business loan of P45,000 is given to Ms. Alfonso. The monthly payment for the loan amounts to
P11,485.35 for 4 months. The interest rate used is 10% convertible monthly. How much is the
outstanding balance after the first payment?
6. Mr. Lachica applied for a P100,000 loan. She plans to pay for this loan annually at 8% per annum for 5
years. The annual payment is computed as P25,045.65.
a. How much is the outstanding balance after the fourth payment?
 b. How much of the 5th payment goes to pay the interest and principal?

6. Additional activities for

application or
remediation
V. REMARKS

VI. REFLECTION

A. No. of learners who earned 80% in the evaluation

B. No. of learners who require additional activities for
remediation
C. Did the remedial lessons work? No. of learners who
have caught up with the lesson
D. No. of learners who continue to require remediation
E. Which of my teaching strategies worked well? Why
did these work?
F. What difficulties did I encounter which my principal
or supervisor can help me solve?
G. What innovation or localized materials did I
use/discover which I wish to share with other
teachers?