Tag: commercial studies

Questions Related to commercial studies

An accounting system where debit and credit rule is not followed.

commercial studies single entry system introduction to single entry system and difference between single entry and double entry system meaning and featuresof incomplete records meaning of incomplete records, reasons for incompleteness and its limitations ascertaining profit or loss from incomplete records preparation of final accounts from incomplete records preparation of statement of affairs double entry system

  1. Double entry system

  2. Single entry system

  3. Financial accounting

  4. Book keeping accountancy

Show answer
Correct Option: B
Explanation:

A system were Profit or loss earned by the business  is based on the difference between its Opening and closing capital. is called Single entry system
In order to find the  capitals , Statement of affairs are prepared which are based on an equation Capital = Assets - Liabilities
Hence, basic accounting aspects of debit and credit are not followed.

Public deposits takes care of both _________ and _________-term financial requirements of a business.

commercial studies sources of business finance - 2 public deposits non-institutional sources - medium-term financing lease financing

  1. Large, medium

  2. Medium, short

  3. Large, short

  4. None of the above

Show answer
Correct Option: B
Explanation:
Public deposits can take care of both medium and short-term financial requirements of a business. 
The deposits are beneficial to both the depositor as well as to the organisation. While the depositors get higher interest rate than that offered by banks.

Companies generally invite public deposits for a period upto ________ years.

commercial studies sources of business finance - 2 public deposits non-institutional sources - medium-term financing lease financing

  1. One

  2. Two

  3. Three

  4. Four

Show answer
Correct Option: C
Explanation:
The deposits that are raised by organisations directly from the public are known as public deposits. The organization in return issues a deposit receipt as acknowledgement of the debt. Public deposits can take care of both short-term or medium-term financial requirements. Companies generally invite public deposits for medium-term period upto three years.

Cost of public deposits is generally _______ than the cost of borrowings from banks and financial institutions.

commercial studies sources of business finance - 2 public deposits non-institutional sources - medium-term financing lease financing

  1. Higher

  2. Lower

  3. Equal

  4. None of the above

Show answer
Correct Option: B
Explanation:
The deposits that are raised by organisations directly from the public are known as public deposits. Cost of public deposits is generally lower than the cost of borrowings from banks and financial institutions.

The deposits that are raised by organisations directly from the public are known as __________.

commercial studies sources of business finance - 2 public deposits non-institutional sources - medium-term financing lease financing

  1. Lease finance

  2. Public deposits

  3. Commercial paper

  4. Trade credit

Show answer
Correct Option: B
Explanation:

The deposits that are raised by organisations directly from the public are known as public deposits. Cost of public deposits is generally lower than the cost of borrowings from banks and financial institutions. Public deposits are beneficial to both depositor as well as the organization. 

Rates of interest offered on public deposits are usually _________ than that offered on bank deposits.

commercial studies sources of business finance - 2 public deposits non-institutional sources - medium-term financing lease financing

  1. Higher

  2. Lower

  3. Equal

  4. Both a and b

Show answer
Correct Option: A
Explanation:
The deposits that are raised by organisations directly from the public are known as public deposits. Rates of interest offered on public deposits are usually higher than that offered on bank deposits. 

Any person who is interested in depositing money in an organisation can do so by filling up a prescribed form. The organisation in return issues a deposit receipt as acknowledgment of the debt.

Collection of public deposits may prove difficult, particularly when the size of deposits required is _________.

commercial studies sources of business finance - 2 public deposits non-institutional sources - medium-term financing lease financing

  1. Large

  2. Small

  3. Medium

  4. Both a and b

Show answer
Correct Option: A
Explanation:

The deposits that are raised directly from the public are public deposits. Any person who is interested in depositing money in an organisation can do so by filling up a prescribed form. the cost of deposits to the company is less than the cost of borrowings from banks. But Collection of public deposits may prove difficult, particularly when the size of deposits required is large.

Public investment in a company is generally in the form of_______________.

commercial studies sources of business finance - 2 public deposits non-institutional sources - medium-term financing lease financing

  1. Shares, debentures and deposits

  2. Purchase of goods

  3. Money Transfer

  4. None of the above

Show answer
Correct Option: A
Explanation:

Public investment in a company is generally in the form of shares, debentures and deposits. It means public can invest in a company by purchasing shares, debentures and deposits.

As per section 2(51) of the Companies Act, 2013, "Key Managerial Personnel", in relation to a company, means _______.
(i) Chief Executive officer or managing director or manager
(ii) Company Secretary
(iii) General Manager
(iv) Whole Time Director
(v) Chief Legal Officer 
(vi) Chief Financial Officer
The correct answer is -

commercial studies finance and accounts meaning and functions of finance and accounts department nature, need and significance of business finance introduction to business capital/finance

  1. (i), (ii), (iv) & (vi)

  2. (i), (iii), (iv), (v) & (vi)

  3. (i), (ii), (v) & (vi)

  4. (i), (iv), (v) & (vi)

Show answer
Correct Option: A

Which of the following is the external user of financial statements?

commercial studies finance and accounts meaning and functions of finance and accounts department nature, need and significance of business finance introduction to business capital/finance

  1. Manager of the business

  2. CEO of the business

  3. Creditor of the business

  4. Controller of the business

Show answer
Correct Option: C