shri vidhyabharathi matric hr.sec.school...public deposits are perceived to be economical for the...

SHRI VIDHYABHARATHI MAT.HR.SEC.SCHOOL, SAKKARAMPALAYAM. 99655-31727

SHRI VIDHYABHARATHI MATRIC HR.SEC.SCHOOL SAKKARAMPALAYAM , AGARAM (PO) ELACHIPALAYAM

TIRUCHENGODE(TK), NAMAKKAL (DT) PIN-637202

Cell : 99655-31727, 94432-31727

COMMON HALF YEARLY EXAMINATION - Dec 2018

STD: XI 14.12.2018

SUBJECT: COMMERCE ANSWER KEY MARKS : 90

Q.

NO

CONTENT

MARK

I

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

11.

12.

13.

14.

15.

16.

17.

18.

19.

20

SECTION -I

CHOOSE THE CORRECT ANSWER

a) Making profit

c) Processing industry

b) Sole trading business

a) Robert owen

c) Headquarters

b) President

b) 1935

c) 2 Lakhs

b) Cost minimization

c) Ethically upright behavior

c) Interest

d) The USA

b) Group corpus fund

b) Two

b) Export Promotion Council

a) General stores

b) International business

c) Geneva

b) Urjit patel( resined)now RBI Governor(Shaktikanta das)

a) 1st April to 31st March

20x1=20

SECTION -II (any seven) 7x2=14

21. Barter system:

Goods were exchanged for goods prior to invention of money.

1x1=2

22. Commerce:

Commerce refers to all those activities which are necessary for

2 mark

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bringing goods from the place of production to the place of their

consumption.

23 Chartered companies:

Chartered companies are established by the King or Queen of a

country. Powers and privileges of chartered company are specified

in the charter. Power to cancel the charter is vested with

King/Queen.

Examples: East Indian Company, Bank of England, Hudson’s

Bay Company.

2 mark

24 central bank:

“A central bank being generally recognized as a bank which

constitutes the apex of the monetary and banking structure of its

country and which performs as best as it can, in the national

economic interest.” - De Kock.

2 mark

25. Types of Warehouses:

A. On the Basis of Ownership

(a) Private Warehouses

(b) Government Warehouses

(c) Public Warehouses

(d) Co-operative Warehouses

(e) Bonded Warehouses

(f) Institutional Warehouses

(g) Distribution Centre Warehouses

B. On the Basis of Commodities Stored

(a) General Warehouses

(b) Special Commodity Warehouses

(c) Cold Storages or Refrigerated Warehouses

(d) Climate Controlled Warehouses

2 mark

26. Public deposit:

Under this method, companies invite public deposits by giving

advertisement in the media. It offers deposit schemes for a longer

tenure. Person interested in making public deposit has to undergo

a simple formality.

2 mark

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The interest rates offered by companies on public deposits are

relatively higher than the bank.

Public deposits are perceived to be economical for the company

since the interest rate on deposits is less than the cost of borrowing

from the bank. (any two)

27. Retailing:

Retailing is the process of selling the goods and services directly

to the ultimate consumers in small quantities.

2 mark

28. International business:

International business denotes all those business activities which

take place beyond the geographical limits of the country.

It involves not only the international movements of goods and

services, but also of capital personnel, technology and intellectual

property like patents, trademarks, know-how and copy rights.

(any one)

2 mark

29. Indent:

Indent is prepared in duplicate. One copy of the indent is sent to

the exporters and second one is retained by the importer and kept

in his records.

2 mark

30. credit cards:

Banks issue credit cards to customers and other eligible persons.

Credit card holder can purchase goods and services on credit at

any shop in India.

If the dues are paid within the stipulated time no interest is

charged.

The credit limit is fixed by the issuing bank based on the income of

the cardholder.

2 mark

SECTION -III (any seven) 7x3=21

31. Port developed by pandia kingdom:

Trade and commerce was so common to Pandiya Dynasty.

Information collected from the diaries of foreign travellers,

voyagers, mariners and adventurers of the ancient world

3 mark

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highlighted the prosperity of trade in the Pandiya country.

The Hebrew and Latin literature, archaeological remains in Aden,

Alexandria, Java, Sumatra and even China add support to the fact of

existence of trade network in the Pandiya country.

Trade in copper, cloth, salt, flower, sandal wood, fish, paddy,

cereals, pearls, etc flourished during their period. The place where

the goods were sold was called ‘Angadi’ in their period.

He described Madurai as iruperu neyamath meaning sleepless city

due to round the clock business activities.

32. The following are the characteristics of a Sole Trader:

Ownership by one man

Freedom of work and Quick Decisions

Unlimited Liability

Absence of Government Regulation ( Explain any 3 )

No Separate Entity

Maintenance of Secrecy

3mark

33. Characteristics of commerce:

Activities involving distribution of goods and services

Comprises trade auxiliaries to trade. Need for capital is

comparatively less . Relatively less risk is involved.

It represents demand side of goods and services.

It creates place utility by moving goods from producers to

consumers (any three)

3mark

34. Regional Rural Bank:

Their objective is to develop rural economy and play

supplementary role to cooperative societies.

They mobilise deposits from the rural public and provide finance

to rural artisans, small entrepreneurs and farmers and try to avoid

their dependency on money lenders.

3mark

35. Responsibility towards employees:

The responsibilities of business towards its employees include:

a. Timely and regular payment of wages and salaries.

b. Proper working conditions and welfare amenities.

3 mark

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c. Opportunity for better career prospects.

d. Job security as well as social security like facilities of

provident fund, group insurance, pension, retirement

benefits, etc.

e. Better living conditions like housing, transport,

canteen, crèches etc.

f. Timely training and development. (any three)

36. Three features of Self Help Group:

The motto of every group members should be “saving first – credit

latter”

Self Help Group is homogeneous in terms of economic status.

The ideal size of a Self Help Group ranges between 10 and 20

members.

The groups need not be registered.

Groups are non-political, voluntary associations and follow a

democratic culture.

Each group should have only one member from one single family.

A group is to be formed with only men or only with women.

Self Help Group holds weekly meetings mostly during non-

working hours, and The groups have transparency among

themselves and they have collective accountability in respect of

financial transactions.

Every group provides a platform to its members for exchange of

their views and ideas freely.(any three)

3 mark

37. Example Entrepot trade:

E.g. Indian diamond merchants in Surat import uncut raw

diamonds from South Africa.

They cut and polish the diamonds in their units in India and re-

export them to the International Diamond Market in Amsterdam.

If an Indian company imports crude oil from Iran and exports it as

petroleum after refining it in India, to Nepal it is called Entrepot

trade.

In this context crude is converted into petrol and exporter as petrol

to Nepal

3 mark


38. Bill of Lading:

Bill of Lading, refers to a document signed by ship owner or to his

agent mentioning that goods specified have been received and it

would be delivered to the importer or his agent at the port of

destination if good condition subject to terms and conditions

mentioned therein.

3 mark

39. Five heads of income:

(i) Income from ‘Salaries’ [Sections 15- 17];

(ii) Income from ‘House Property’ [Sections 22-27];

(iii) Income from ‘Profits and Gains of Business or Profession’ [Sections

28- 44];

(iv) Income from ‘Capital Gains’ [Sections 45-55]; and

(v) Income from ‘Other Sources’ [Sections 56-59].

3marks

40. Company:

“A company is an association of manypersons who contribute

money or money’sworth to a common stock and employ it insome

trade or business, and who share theprofit and loss (as the case

may be) arising there from.”

3marks

SECTION -IV 7x5=35

41. Hindrances of business:

Hindrance of person

Hindrance of place

Hindrance of time

Hindrance of risk of deterioration in quality

Hindrance of risk of loss

Hindrance of knowledge (Explain any five)

Hindrance of exchange

Hindrance of finance

Hindrance of developing the exact product

5mark

(or)

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Compare Industry ,Commerce,Trade: (Explain any five)

Industry Commerce Trade

Meaning :

Extraction

reproduction

conversion,

processing and

construction of

useful products

Activities

involving

distribution of

goods and

services

Purchase and

sale of goods and

services

Scope: consists

of all activities

involving

conversion of

materials and

semi-finished

products into

finished goods

Comprises trade

auxiliaries to

trade

Comprises

exchange of

goods and

sevices

Capital:

Generally large

amount of

capital is

required

Need for capital

is comparatively

less

Small capital is

needs to

maintain stock

and to grant

credit

Risk: Risk

involved is

usually high

Relatively less

risk is involved

Relatively less

risk is involved

Side: It

represents

supply side of

goods and

services

It represents

demand side of

goods and

services

It represents

both supply and

demand

Utility creation:

It creates form

utility by

It creates place

utility by moving

goods from

It creates

possession

utility through


changing the

form or shape of

materials

producers to

consumers

exchange

42. Dissolution of Partnership

Dissolution of firm

a)Without order of court

Mutual Agreement

compulsory Dissolution

On the occurrence of cintignencies

Bu notice

b)With order of court

Insanity

Permanent incapacity

Misconduct

Breach of agreement

Transfer of interest

Perpetual Losses

Any other just and equitable ground

5x1=5

(or)

Prospectus

According to Section 2(36) of the Companies Act, any document

inviting the public to buy its shares or debentures comes under

the definition of prospectus. It also applies to advertisements

inviting deposits from the public.

Contents

A prospectus is “the only window through which a prospective

investor can look into the soundness of a company’s venture”.

Hence it must specify at least the following matters as per

Schedule II:

(i) The prospectus contains the main objectives of the company,

the name and addresses of the signatories of the Memorandum

of Association and the number of shares held by them.

(ii) The name, addresses and occupation of directors and

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managing directors.

(iii) The number and classes of shares and debentures issued.

(iv) The qualification share of directors and the interest of

directors for the promotion of company.

(v) The number, description and the document of shares or

debentures which within the two preceding years have been

agreed to be issued other than cash.

(vi) The name and addresses of the vendors of any property

acquired by the company and the amount paid or to be paid.

(vii) Particulars about the directors, secretaries and the

treasures and their remuneration.

(viii) The amount for the minimum subscription.

(ix) If the company carrying on business, the length of time of

such businesses.

(x) The estimated amount of preliminary expenses.

(xi) Name and address of the auditors, bankers and solicitors of

the company

(xii) Time and place where copies of balance sheets, profits and

loss account and the auditor’s report may be inspected.

(xiii) The auditor’s report so submitted must deal with the profit

and loss of the company for each year of five financial years

immediately preceding the issue of prospectus.

(xiv) If any profit or reserve has been capitalized, the particulars

of such capitalization will be stated in the prospectus. .

(any five )

43. Advantages of Railway Transport

( Write three point from each group)

Railways are well suited for carrying heavy and bulky goods

over long distances.

It can provide long distance travel throughout the day and night

with unbroken services.

It can provide better production and safety to the goods than

motor transport.

5 mark


The goods generally carried in closed wagons are not exposed to

sun, rain etc.

Though initial investment is large, in the long run the operating

expenses will be very low in railways and it will prove a cheaper

mode of transport.

It requires less time than motor transport for carrying goods

over long distance with greater speed

It has regular schedule of timing and is available throughout the

year.

It provides unaffected services whether rainy or shinny weather

conditions.

Advantages of inland waterways

It is considered as the cheapest mode of transport among the

other modes of transport.

It carries goods smoothly due to the absence of shaking and

jolting during transit. It is eminently suitable for the carriage of

fragile goods like glassware, earth ware etc., without causing

damage.

It is most suitable for heavy loads.

There is lesser pollution in water transport.

Initial investment on river services as well as expenditure on

their maintenance is much lesser as compared to road and rail

transport.

Advantages of Air Transport

It provides a regular, convenient, efficient and quick service.

Perishable goods like fruits, vegetables, egg, meat, etc., can be

transported quickly.

It does not require huge investment for construction and

maintenance of track like railways.

They provide comfortable services for passengers and safety for

their goods.

It can be used to move goods to areas, which are inaccessible to

other means of transport.

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It is very much helpful for flood or landslide and war rises to the

occasion to save human life from danger.

(or)

Principles of Insurance

Utmost Good Faith

Insurable Interest

Indemnity ( Explain any five)

Causa Proxima

Contribution

Subrogation

Mitigation

44. The following are the features of internal trade

The buying and selling of goods takes place within the

boundaries of the same country.

Payment for goods and services is made in the currency of the

home country.

It involves transactions between the producers, consumers and

the middlemen.

It consists of a distribution network of middlemen and agencies

engaged in exchange of goods and services.

In home trade the risk of transportation is very less when

compared to the foreign trade.

In home trade the laws prevailing in that country only have to be

followed.

The aim of home trade is to provide the goods and services

economically.

The goods must be a part of domestic production.

Goods must be purchased from an individual or a firm

established within a country.

Goods can be delivered using locally available modes of

transport.

It does not involve any custom/import duty, but buyers need to

pay the taxes to the Government. (any five)

5 marks


(or)

Owner’s Funds

Owner’s funds mean funds which are provided by the owner of

the enterprises

who may be an individual, or partners or shareholders of a

company. The profits reinvested in the business (ploughing back

of profit or retained earnings) come under owner’s funds.

These funds are not required to be refunded during the life time

of business enterprise. It provides the owner the right to control

the management of the enterprise.

2. Borrowed Funds

The term ‘borrowed funds’ denotes the funds raised through

loans or borrowings. For example debentures, loans from banks

and financial institutions, public deposits, trade credit, lease

financing, commercial papers,

factoring, etc. represent borrowed funds.

45. Following are the functions of wholesalers:

a.Collection of Goods:

Wholesaler collects the goods from manufacturers or producers

in bulk.

b. Storage of Goods:

Wholesaler collects and stores them safely in warehouses, till

they are sold out. Perishable goods like fruits, vegetables, etc. are

stored in cold storage facility.

c. Distribution:

Wholesaler sells goods to different retailers. Thus he performs

the function of distribution.

d. Financing:

Wholesalers provide financial support to producers and

manufacturers by providing money in advance to them. He also

sells goods to retailer on credit. Thus, at both ends wholesaler

acts as a financier.

5 marks

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e. Risk Taking:

Wholesaler buys finished goods from the producer and keeps

them in the warehouses till the time they are sold and assumes

the risk arising from price, spoilage of goods, and changes in

demand.

f. Grading Packing and Packaging:

Wholesaler classifies the goods into different categories. He

grades the goods on the basis of quality, size and weight etc. He

also undertakes packaging of goods and also performs the

function of branding.

g. Providing Information:

Wholesalers provide valuable information to retailers and

producers. The retailers are informed about the quality and type

of products available in the market for sale. The producers are

informed about the changes in taste and fashions of consumers

by wholesalers so that they may produce the goods on the basis

of tastes and preferences of customers.

h. Transportation:

A wholesaler arranges for the transport of goods from producers

to his warehouse and from the warehouse to retailer. Many

wholesalers maintain their own trucks, carry goods in bulk and

add place utility to the goods.

(any five)

(or)

Distinguish between Internal and International trade:

1. Meaning

2. Participants in Business

3. Mobility of Factor of production

4. Nature of Consumers

5. Business system

6. Currency Used

7. Mode of Transport

8. Risk Exposure


9. Scope of Market

10. payment of Excise duty (Explain any five)

46 Document used in export trade:

Indent

Certificate of Origin

Export Inspection Certificate

Mate’s receipt

Shipping order

Shipping bill

Bill of lading

Marine Insurance policy

Consular Invoice

Railway receipt/ lorry receipt

Arranging letter of Credit

commercial invoice and submitting

Bills of Exchange

Bank certificate payment

5 marks

(or)

CAPITAL ACCOUNT

Capital account consists of three components

. Private Capital

Banking Capital

Official Capital

1. Private Capital

Private capital consists of foreign investments, long term loan

and foreign currency deposits

2. Banking Capital

Banking capital includes movement into external financial asset

and liabilities commercial and co-operative banks authorized to

dealing in foreign exchange

3. Official Capital

It includes RBI’s holdings of foreign currency and special

drawing rights (SDR) held by the Government

47 Two International company:

TATA

HCL

INFOSYS

HERO MOTOCORP

BAJAJ

TVS

International company functioning in foreign countries:

(If any relevant point is written by Student give full

mark)

5 marks

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(or)

Cheque

A cheque is an easy and safe method of making

payments to or withdrawing money from a bank.

According to negotiable instruments Act 1881. “a

cheque is a bill of exchange drawn on a specified banker

payable on demand”.

Used the cheques

A cheque is an agreement between two induivals or

organization to make a payment

A cheque is a written document instructing a bank or

building society to debit your account and pay someone,

Cheque can be used to pay money in and out of your

account.

Typically cheque are used to pay bills. Tradesmen or to

pay a someone face to face

When we deposite cheque into our account our bank

will sent a cheque to the bank of the person to wrote the

cheque.

(If any relevant point is written by Student give full

mark)

*********

Department of Commerce SHRI VIDHYABHARATHI MATRIC HR.SEC.SCHOOL SAKKARAMPALAYAM , AGARAM (PO) ELACHIPALAYAM

TIRUCHENGODE(TK), NAMAKKAL (DT) PIN-637202

Cell : 9965531727, 9865951332 , 9790633519

**********

www.nammakalvi.org

shri vidhyabharathi matric hr.sec.school...public deposits are perceived to be economical for the...

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