Qs 2

Question 4:
Anu and Renu are good friends. After completing a course in Fashion Designing, tên years
back, both of them started their own separate outlets in Jaipur and Delhi respectively to
earn their livelihood. Renu buys readymade garments from various manufacturers and sells
them in her store. However, Anu designs her own range of clothing. She gets them made
through her team of designers and sells them directly under the brand name 'Eleganza'.
Although, both of them are making good returns on their investments but in past they have
also incurred huge losses due to changes in consumer tastes and fashion. Also, despite being
in business for such a long time they cannot say with certainty as to what amount of profit
will be earned by them in future.
By quoting lines from the paragraph identify the various features of business discussed above.

Question 3:
Harsh is a well known orthopedic doctor in Agra. He runs his private clinic under the name
Joint and Bone Clinic'.
In context of the above case:
(7) Identify the type of economic activity that Harsh is engaged in.
(i1) State any three features of the type of economic activity as identified in part(i) of the
question.

Qls

Internal Trade
Guestion 6i
Rajindlef Singh and his brother Ravinder Singh own a large scale retail outlet at a central
lecation in Amnritsar They deal in varied kinds of products like textiles, footwear, cosmetics,
etc. which are sold through different divisions within the establishment.
In context of the above case:
(a) Identify the type of retail outlet being described in the above lines.
(b) State any two merits and two limitations of the type of retail outlet as identified
part (a) of the question.

Question 5:
The brand Vhishwas' was established in the year 1970 by PR Enterprises Ltd. to produce all
kinds of stainless steel tableware and kitchenware products. In due course of time the brand
became popular among consumers in India and enjoys a huge market share. The company
sells
its products through a wide distribution network comprising of different kinds of retailers.
Pranav has been selling the company's products for over two decades and now owns a retail
outlet in Nagpur where in all kinds of tableware and cooking ware are available for sale.
moving with his
In context of the above case:
(a) How would you classify Pranav as a type of retailer?
(b) Name the category of the type of retail trade as identified in part (a) of the question
under which he should be placed.
(c) List any three features of the type of retail trade as identified in part (a) of the question.

Questiøn 4:
Ajay is a trader dealing in low cost fashionable footwear. In order to sell his merchandise he
opens his shop on fixed days in different markets.
In context of the above case:
(a) How would you classify Ajay as a type of retailer?
(b) Name the category of the type of retail trade as identified in part (a) of the question
under which he should be placed.
(c) Also, briefly explain any two other types of retailers which fall in the same category
as Ajay as identified in part (a) of the question.

Question 3:
Biju isa vegetable seller who heaps all kinds of vegetables on his hand cart every morning
and moves from one place to another during the day to sell his stock at the doorstep of the
customers.
In context of the above case:
(a) Biju will be classified as which type of retailer and why?
(b) Name the category of the type of retail trade as identified in part (a) of the question
under which he should be placed.
(c) State any two features of the type of retailers as identified in part (b) of the question.
Answer:
(a) Biju will be classified as an itinerant retailer because he keeps on moving with his
merchandises from place to place, in search of customers and does not operate his
business from a fixed place.
(b) The category of itinerant retailers under which Biju should be placed is the Peddlers
and hawkers.
(c) The two features of Peddlers and hawkers are as follows:
(i) Despite being one of the oldest form of retailers in the market place, they are
prevalent even today and are often found selling vegetables and fruits, snacks
and ice creams, etc.
(ii) They are either small producers or petty traders who deal in low priced and non
standardised products, hence their reliability in terms of quality and price is a
major concern for the buyers.

Small business
CASE STUDY BASED QUESTIONS
Question 1:
Manish has set up a manufacturing unit to produce all kinds of school and office supplies such
as pencils, pens, paper of different varieties, notebooks, etc. in Noida. His total investment
in Plant & Machinery is about 3 crore. Identify the category into which his business will
fall as per the Micro, Small & Medium Enterprises Development (MSMED) Act, 2006.
Answer:
Manish's total investment in Plant & Machinery is more than twenty five lakh rupees but
does not exceed five crore rupees. Hence, as per the Micro, Small and Medium Enterprises
Development (MSMED) Act, 2006, his business is a small enterprise.

Question 13:
Rakesh plans to set up an environmental friendly textile factory. He plans to use fossii fuees
to make paint, plastics and polymers. Since the waste water from textile processing and
dyeing contain residues, he has also decided to ensure its appropriate treatment before it is
released into the environment. He is planning to approach a Special Financial Institution to
raise loans for his business.
In context of the above case:
(a) Describe briefly any two Special Financial Institutions in India.
(b) State any two merits of raising loans from financial institutions.
(c) List any two values that Rakesh wants to communicate to the society.

ouestion 12:
Gunjan Cinemas is a popular film entertainment company in Delhi. Keeping in view the
growing culture of multiplex its owners have decided to make some changes in the interiors
like creating a lounge area, installing more effective sound systems, etc. The company wats
to raise the required funds for a period of more than one year but less than five years.
In context of the above case:
(a) Identify and explain the type of funds that Gunjan Cinema seeks to raise on the basis
of time period.
(b) Explain any one appropriate source of the type of funds as identified in part (a) of
the question.
Also, state its any two merits.

Question 10:
"Gracious Ltd.' is a US based company. The company plans to tap the Indian capital market
through its forthcoming issue of equity shares. Outline the instrument through which it can
raise funds from the Indian capital market.

Question 4:
Ann has been successfully running a soft skills training company for the
Bangalore. Her company has become popular and enjoys a good reputation in the city. She
now plans to start a chain of soft skills training centers and has identified four strategic places
for the same in the city. Till now she has been managing all the financial requirements of
her business through the profits made in her business. However, in order to implement her
expansion plans funds will have to be raised externally.
past five
years in
In context of the above case:
(a) "Till now she has been managing all the financial requirements of her business through
the profits made in business.' Name the source of the funds being mentioned in the
statement and state its any three merits.
(b) Suggest any external source of funds that Ann can use to finance her expansion plans.
Also, give any two features of such a source of finance.

Questión 5:
Tata Motors is the first Indian Company to introduce vehicles with Euro norms in order to
make environment friendly engines. It has also manufactured CNG version of buses and
launched a CNG version of its passenger car, the Indica. Moreover, the company has planted
80,000 trees in the works and the township and more than 2.4 million trees have been planted
in Jamshedpur region. The company has directed all its suppliers to pack their products in
alternate material instead of wood.
In context of the above case:
(a) Identify the concern being discussed above in context of social responsibility and list
any four specific steps which can be taken by business enterprises for it.
(b) List any two values being propagated by Tata Motors.

Question 4:
Taste Buds Ltd. is a well reputed chain of take away restaurants in Delhi. The company's
earnings are high as it constantly reviews and revises its menu in the light of changing needs
and preferences of the consumers. Considering the fact that in India, a child goes blind every
four minutes, out of which ninety percent of the children can be easily treated so that they
can lead normal lives the company has extended its financial support to many charitable eye
hospitals in their endeavors to eradicate preventable childhood blindness from our country.
In the context of this case:
(a) Briefly explain two kinds of social responsibilities being fulfilled by Taste Buds Ltd.
(b) Name any two values which are being pursued by Taste Buds Ltd.

Question 3:
Vash had started a sugarcane factory in Moradabad two years back. He pays wages to the
male workers at a rate which is much lower than the minimum wage rate prescribed by the
government. The wages paid to the female workers are even lesser. He has also employed
child labour extensively in the factory to further reduce the labour cost. Moreover, the working
conditions in the factory are inappropriate as there is lack of hygiene, proper ventilation,
facility for safe drinking water, etc. His business has always faced the problem of shortage
of labour since its inception.
In context of the above case:
(a) Yash has ignored his social responsibility towards which interest group?
o (b) Why do you think it is important for a business enterprise to function in a socially
responsible way? Explain by giving any four suitable points.
(c) Name any two values which are being ignored by Yash.

Question 2:
| Britannia Industries Ltd. is committed to help secure every child's right to growth and
development through good food everyday. The company is working in partnership with
Global Alliance for Improved Nutrition (GAIN) and the Naandi Foundation to supply iron
fortified Tiger biscuits to supplement the Mid-Day Meal program in schools. Iron deficiency
among Indian children is a key cause of school dropouts as well as decreased productivity.
In keeping with its core essence of "Swasth Khao Tan Man Jagao", the company constantly
strives to find sustainable opportunities to drive home the message of nutrition and good
food habits among children at the right age.
In context of the above case:
(a) Identify the kind of social responsibility being discharged by Britannia Industries Ltd.
(b) Briefly explain any two other kinds of social responsibilities.

Quéstion 11:
After becoming a certified chartered accountant Ridhima has recently started a tax consultancy
firm. Her brother being an IT professional has advised her to ensure the security and safety
of e-transactions.
Apart from the transaction risks what are the other two types of e-business risk that Ridhima
needs to guard her business against?

Question 12:
Phere is increasing pressure on pharmaceutical companies to improve productivity and
profitability, without sacrificing quality. In order to sustain themselves many competitive
global pharmaceutical companies such as AstraZeneca, GlaxoSmithKline, Pfizer, Novartis and
Eli Lilly are outsourcing a major portion of their clinical drug testing work to India in an effort
to tap the pool of highly-skilled, but lower-wage demanding, scientists. India's attractiveness
as an offshore destination for clinical research is further enhanced by investment incentive
policies ranging from tax holidays to duty exemptions as well as India's acceptance of the
International Conference on Harmonization Guidelines for Good Clinical Practices.
In context of the above case:
t (a) Define the term outsourcing.
(b) Identify and explain the type of outsourcing being described in the above lines.

Question 13:
'Dhoom Ltd.' is a well known sports equipment company in India. The company has decided
to open 10 sports complexes across the country. The company plans to outsource its non
core activities like security services and canteen services besides payroll, human resources,
accounting and customer call center relations.
In context of the above case;
(a) Explain any three benefits that the company is going to derive from outsourcing.
(b) What is the main concern of the firms over outsourcing?

Question 14:
'Divine Delight' is a well known chain of home furnishing products in India. The company
has outsourced IT-enabled common finance and accounting processes that are transactional
in nature, such as accounts payable, accounts receivables, and payroll services like payroll
processing, leave management, reimbursement processing and compensation planning.
ve
rt
In context of the above case:
(a) Explain briefly the features of outsourcing.
(b) Identify and explain the type of outsourcing being described in the above lines.

Question 15:
Over the years internet has revolutionized our lives. One of the significant utility of the internet
is in the banking sector. It has paved way for innumerable new e-banking opportunities to
the advantage of both the business and their customers.
CHAP
Definit
the cor
In context of the above case:
(a) What is banking over internet known as ?
(b) State any four advantages of banking over internet.
(c) Briefly explain NEFT as banking service.

Question 6:
Gauri took an insurance policy for her home without disclosing that the home is beino
used to house a catering business. After few months, a gas cylinder explosion, caused major
damage to her property. Consequently, she filed a claim against the insurance company for
compensation of loss. On investigating the matter, the insurance company discovered about
the commercial use of the home and refused to pay any claims. Identify and explain the
principle of insurance which has been violated in the above case.

Question 8:
Jeevan insures his property worth 10 crore with two insurers 'AIG Ltd.' and 'MetLife Ltd.'
for < 6 crore and 4 crore, respectively. Due to an earthquake, the actual damage caused
to Jeevan's property is worth 3 crore. He filed a claim for 3 crore against each of the
insurance companies. Identify and explain the principle of insurance which has been violated
in the above case.
Question 9:
Subhash's factory catches fire due to an electric short-circuit. However, Subhash does not
take any action to stop the fire, neither does he call up the nearest fire station. Instead he
remains inactive and watch his factory burn thinking that why should he be worried when
he has taken a fire insurance for the factory. Later on he is denied any claim of loss by the
insurance company. Identify and explain the principle of insurance which has been violated
in the above case.

Question 34:
Dharvi started an export business in the form of a private company along with her uncles
Mr. Danush Kumar and Mr. Manush Kumar. Later on, she came to know that Mr. Manush
Kumar had forged the signatures of Mr. Danush Kumar on the Memorandum of Association.
She is now fearing that the Incorporation of the company will be considered invalid.
In context of the above case:

Saikripa Private Ltd. was in the process of incorporation. The Promoters of the Company
signed an agreement for the purchase of ten computers for the Company and payment was
to be made to the suppliers of the computers by the Company after incorporation. The
Company was incorporated and the computers were used by it. Shortly after incorporation,
the Company went into liquidation and the debt could not be paid by the Company for the
purchase of the computers. As a result, suppliers sued the promoters of the Company for
the recovery of money.
In context of the above case:
(a) During the promotion of the company the promoters may enter into certain contracts
with third parties on behalf of the company as described above. What are these types
of contract known as?
(b) Examine whether promoters can be held liable for payment in the above case.

Question 22:
A new cooperative store has been set up in Delhi through registration under Delhi Cooperative
Societies Act. It has been setup to make bulk procurement of essential consumer goods from
the various wholesalers and supply the same to public at large on reasonable prices, to enable
those stores to sell the consumer goods to the public on lower prices than those prevailing
in the open market.
In context of the above case:
(a) Identify the type of cooperative society being described in the above lines.
(b) State any three features of the type of cooperative so identified in part (a) of the question

Question 12:
Seema, Sushma and Suhana became good friends while persuing a fashion designing course
Gom a premier institute in Delhi. Seema expressed her desire to start a business in partnership
ith Sushma and Suhana after completing their course. Sushma and Suhana readily agreed to
the proposal but at the same time expressed their desire to join Seema in business only
n the condition that their liability will be limited in the business.
In context of the above case:
(a) Identify the type of partnership that Sushma and Suhana are referring to.
(b) How is this type of partnership different from the other type of partnership formed
on the basis of liability?

Question 8:
un Bimesh and Czar are partners in a partnership firm manufacturing air conditioners.
Their firm is not registered. Recently, in order to increase the profits of the firm, Bimesh
docided to use substandard raw materials without the knowledge of Arun and Czar. As a
result, many accidents were reported by the consumers and a case has been filed against
2r,
the firm.
(a) Is this wrong act of Bimesh binding on Arun and Czar too? State the related feature
of the partnership form of business organization.
(b) Can Arun and Czar file a case against Bimesh? Why or why not? Give a suitable
reason in support of your answer.
(c) List any two values being ignored by Bimesh.

Question 3:
Kiran is a sole proprietor. Over the past decade, her business has grown from operating a
neighbourhood corner shop selling accessories such as artificial jewellery, bags, hair clips and
nail art to a retail chain with three branches in the city. Although she looks after the varied
functions in all the branches, she is wondering whether she should form a company to better
manage the business. She also has plans to open branches countrywide.
(a) Explain two benefits of remaining a sole proprietor.
(b) Explain two benefits of converting to a joint stock company.
(c) What role will her decision to go nationwide play in her choice of form of the organisation?
(d) What legal formalities will she have to undergo to operate business as a company?

Q. What is a 'MOA'? Briefly explain it's clauses

Q. What is the effect of conclusiveness of the 'Certificate of Incorporation' and 'Commencement

Of Business'?

Question 8:
Undia is the largest milk producer of the world. Moreover, increasing demand of milk and
milk product has made dairy farming a profitable business. Considering these facts Raghu,
an industrialist has decided to set up a dairy farm and a cheese producing unit in Haryana.
He plans to deal in an extensive range of Fresh Mozzarella; Processed Cheeses; Pizza
Cheese;
Cheese Singles; Naturally Flavored Cheeses (with Black pepper, Garlic, Cumin, Herbs &
Spice); Mascarpone; Mozzarella & Grated Cheese for Pizza in various combinations.
In context of the above case:
(i) Identify the different kinds of industries Raghu wants to set up.
(ii) State and explain the categories of types of industries to which the different kinds of
industries as identified in part (i) belong to.

Question 5:
Shourya is running a take away fast food joint in Kanpur under the name 'Swaad'. Recently,
when his cousin Rahul organized a party at his place he had placed an order for food at
Swaad' worth 7 5000. However, Shourya declined to take the money from Rahul because of
his love and affection for him.
In context of the above case:
(i) Will this activity related to the of supply of food from Shourya's restaurant to Rahul
be classified as a business activity? Why or why not?
(ii) Mention the related feature of business.
LQuestion 6:
Reema bought a new house recently. She plans to shift there in near future. Therefore, she is
selling off her old kitchen appliances at OLX and has also made some profit in the
In context of the above case:
to
process.
(1) Will this transaction be constituted as a business activity? Why or why not?
(11) Mention the underlying characteristic of business.