Namma Kalvi

www.nammakalvi.org
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. CONTENT
NO MARK
SECTION -I
I CHOOSE THE CORRECT ANSWER
1. a) Making profit
2. c) Processing industry
3. b) Sole trading business
4. a) Robert owen
5. c) Headquarters
6. b) President
7. b) 1935 20x1=20
8. c) 2 Lakhs
9. b) Cost minimization
10. c) Ethically upright behavior
11. c) Interest
12. d) The USA
13. b) Group corpus fund
14. b) Two
15. b) Export Promotion Council
16. a) General stores
17. b) International business
18. c) Geneva
19. b) Urjit patel( resined)now RBI Governor(Shaktikanta das)
20 a) 1st April to 31st March
SECTION -II (any seven) 7x2=14
21. Barter system:
1x1=2
 Goods were exchanged for goods prior to invention of money.
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:
2 mark
 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.
24 central bank:
2 mark
 “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.
25. Types of Warehouses:
2 mark
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
26. Public deposit:
 Under this method, companies invite public deposits by giving 2 mark
advertisement in the media. It offers deposit schemes for a longer
tenure. Person interested in making public deposit has to undergo
a simple formality.

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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 2 mark
to the ultimate consumers in small quantities.
28. International business:
 International business denotes all those business activities which 2 mark
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)
29. Indent:
2 mark
 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.
30. credit cards:
2 mark
 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.

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, 3 mark

voyagers, mariners and adventurers of the ancient world

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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:
3mark
 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
33. Characteristics of commerce:
 Activities involving distribution of goods and services 3mark
 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)

34. Regional Rural Bank:

3mark
 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.
35. Responsibility towards employees:
 The responsibilities of business towards its employees include: 3 mark
a. Timely and regular payment of wages and salaries.
b. Proper working conditions and welfare amenities.

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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:
3 mark
 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)
37. Example Entrepot trade:
 E.g. Indian diamond merchants in Surat import uncut raw 3 mark
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

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38. Bill of Lading:

 Bill of Lading, refers to a document signed by ship owner or to his 3 mark
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.
39. Five heads of income:
(i) Income from ‘Salaries’ [Sections 15- 17];
(ii) Income from ‘House Property’ [Sections 22-27]; 3marks

(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].
40. Company:
 “A company is an association of manypersons who contribute 3marks
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.”
SECTION -IV 7x5=35
41. Hindrances of business:

 Hindrance of person

 Hindrance of place
5mark
 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

(or)

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 Compare Industry ,Commerce,Trade: (Explain any five)
Industry Commerce Trade
Meaning : Activities Purchase and
Extraction involving sale of goods and
reproduction distribution of services
conversion, goods and
processing and services
construction of
useful products
Scope: consists Comprises trade Comprises
of all activities auxiliaries to exchange of
involving trade goods and
conversion of sevices
materials and
semi-finished
products into
finished goods
Capital: Need for capital Small capital is
Generally large is comparatively needs to
amount of less maintain stock
capital is and to grant
required credit
Risk: Risk Relatively less Relatively less
involved is risk is involved risk is involved
usually high
Side: It It represents It represents
represents demand side of both supply and
supply side of goods and demand
goods and services
services
Utility creation: It creates place It creates
It creates form utility by moving possession
utility by goods from utility through

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changing the producers to exchange

form or shape of consumers
materials
42. Dissolution of Partnership
Dissolution of firm
a)Without order of court
5x1=5
 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
(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 5 mark
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.

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 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 5 marks
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)

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(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: 5 marks
 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.

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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

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 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
www.nammakalvi.org
 Shipping bill
 Bill of lading
 Marine Insurance policy 5 marks
 Consular Invoice
 Railway receipt/ lorry receipt
 Arranging letter of Credit
 commercial invoice and submitting
 Bills of Exchange
 Bank certificate payment
(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 5 marks
 TVS
International company functioning in foreign countries:
(If any relevant point is written by Student give full
mark)

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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

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