Correct Answer: C. embargo

Correct Answer: D. active partner

Correct Answer: D. cleared

Correct Answer: A. packaging

Correct Answer: A) The capital market

Explanation

A public limited company is a type of company that offers shares to the public and has limited liability. Long term loans are loans that have a repayment period of more than one year. The capital market is where long term loans can be raised by a public limited company.

The capital market is a market where long-term securities such as bonds and stocks are bought and sold. It is a market for raising long-term funds, and it includes institutions such as stock exchanges, investment banks, and mutual funds. Companies can issue bonds or stocks in the capital market to raise funds for long-term projects or expansion plans.

In contrast, the money market is a market for short-term borrowing and lending, where securities such as treasury bills and commercial papers are traded. Bank overdraft is a short-term borrowing facility that allows a company to withdraw more money than it has in its account, while discount houses are institutions that provide short-term loans to businesses at a discount.

In summary, a public limited company can raise long term loans through the capital market, which is a market for long-term securities such as bonds and stocks. To learn more about this, please read the relevant sections of the recommended textbooks.

Explanation

(a)Types of co-operative societies include:

• Manufacturers/producer co-operative/agricultural co-operative;
  • Multipurpose co-operative.
  • Thrift and credit society;
  • Retail co- operative;
  • Wholesale co-operative;
  • Consumer co-operative;

(b)Explanation of business objectives.

• Survival: This is the desire of firms to remain in business despite stiff competition.
• Profit maximization: One of the objectives of firms is to earn high profit in order to pay dividend to its shareholders and remain in business.
• Growth: This is the desire of a business to expand its activities beyond its current undertakings through increase in sales, total assets and employment.
• Innovation: It is the ability of firms to create new products, methods of production as well as new areas of business through continuous research and development.
• Social responsibility: Businesses have the desire to contribute to the provision of basic infrastructure and also provide assistance in the areas of education and health sectors of communities in which they operate.

Correct Answer: C. i and ii only

Explanation

The extractive industry involves all kinds of works concerned with the extraction of natural resources from the soil, the sea, or forest e.g. farming, fishing, hunting, lumbering, mining, quarrying, etc. Option C is the correct answer from the given options

Explanation

(a) Explanation of Current Assets with examples

(a) current asset consists of those resources of a business that can easily be changed into cash for example stock, debtors, bill, receivable including cash at bank and cash in hand.

(b) Uses of working capital:

(i) it is used to determine whether the business can meet its financial obligations.

(ii) It serves as a check against over trading.

(iii) It helps to determine the solvency of a business

(iv) It is used in the day to day running of the business.

(c) (i)Calculation of Current Liabilities

Current Liabilities of Zig Stores # Creditors 60,000 Bank overdraft 10,00070,000

(iii) Calculation of Current Assets

Current Asset of Zig Stores Stocks 76,000 Debtors 50000

Explanation

(a)Insurance underwriter: An underwriter is one who insures against marine and other risks. He gives his name to an insurance policy as a guarantee of payment of a specified amount in the event of a loss. Underwriters usually operates in syndicates. Members who take the greatest part of the risks are referred to as leading underwriters.

(b)Promoters: They are people who form or float a public limited liability company and establish it as a going concern. Promoters are a class of people skilled in dealing with the preliminaries necessary to the formation of a company and who possess expert knowledge of the investing public. Promotes stand in a trust position to the company they promote and must not derive any personal gain from the work of promotion without first disclosing the fact to independent representatives.

(c)Auctioneer: This is a person licensed by the government to sell movable and immovable properties at a public auction. He sells through bidding for prices and earns commission for his services. He has a right of lien over the properties he has in his possession until payment and commission are paid. He must sell to the highest bidder

(d)Factors: He is a person who has in the ordinary course of his duties, authority to sell goods or cosign goods for the purpose of sale or to buy goods or to raise money for the security of the goods in his possession etc. A factor has a greater power than an ordinary agent. He also has right of lien for any amount due to him on the goods he holds for his principal.

(e)Broker: This is a person who acts as an agent on behalf of a principal. A broker does not take title to goods he deals in. He takes commission known as brokerage. He brings together those who intend to buy or sell.

Explanation

(a) Four types of Co-operative Societies are:

(i) Credit and Thrift Co-operative society: It is formed by low income earners. It enables low income earners to pool large funds through weekly contribution. It grants loans to members at low rate of interest. It settles disputes among members.

(ii) Wholesale Co-operative Society: This is formed by wholesalers. It buys in bulk from producers. It sells in small units to retailers. It is able to raise large amount to finance wholesale purchases. It settles disputes among members.

(iii) Consumers Co-operative society: This is made up of consumers. They protect themselves against exorbitant prices of sellers. They buy in large quantities and distribute to members in small quantities. Surplus is distributed to members in proportion of patronage. It settles disputes among members.

(iv) Producer Co-operative: This is formed by producers of similar commodities. It undertakes joint marketing of products on wholesale or retail basis. It organizes cooperative production and shares any useful knowledge among members.

(b) Advantages of Cooperative societies are:

(i) Every member is enabled to contribute to common interests leading to proper harnessing of resources.

(ii) Co-operative society ensures greater production, reduces wastage and ensures greater financial benefit to members.

(iii) Cooperative societies encourage savings among members.

(iv) Cooperative societies have corporate existence and perpetual succession.

(v) Cooperative societies ensure that their members benefit from large scale production which would otherwise be beyond the reach of a single person.

(c) Problems of Co-operative societies are:

(i) Financial problems: Lack of capital inhibits the growth and development of co-operative societies.

(ii) Illiteracy: Many members cannot read and write and so do not under-stand what happens when it comes to paper work.

(iii) Amateur management: The management of cooperative societies lacks administrative and business acumen.

(iv) Difficulty in recovering loans: It is very difficult to recover loans granted to members.

(v) Corruption and embezzlement: Some members may embezzle the money of the co-operatives.