ISC Commerce Previous Year Question Paper 2012 Solved for Class 12
- Candidates are allowed additional 15 minutes for only reading the paper. They must NOT start
writing during this time. - Answer Question 1 from Part I and seven questions from Part II.
- The intended marks for questions are given in brackets [ ].
Part – I
(Compulsory)
Question 1.
Answer briefly each of the following questions (i) to (xv): [15 × 2]
(i) Why does a Joint Stock Company enjoy perpetual existence?
(ii) What are the two ways in which a Joint Stock Company can be promoted?
(iii) What is a participating preference share?
(iv) Mention two ways of removal of a Director of a company.
(v) Give two advantages of public deposit from the point of view of a company.
(vi) Write any two features of principles of management.
(vii) Name the elements of directing function of management.
(viii) What does the capital clause of Memorandum of Association contain?
(ix) Give two agency functions of Commercial Banks.
(x) Explain feedback in the process of communication.
(xi) Mention any two limitations of direct mail advertizing.
(xu) State any two devices developed in the recent past for rapid and efficient communication.
(xiii) Expand the terms:
(a) ICICI
(b) IDBI
(xiv) Explain the integration concept of management.
(xv) Name two physical supply functions of marketing.
Answer:
(i) Out of syllabus
(ii) Out of syllabus
(iii) The participating preference shareholder receives stipulated dividend and shares additional earnings with the common shareholders. But this share is usually non-cumulative which confirms the view that preference share does have both protective and profit participating provisions.
(iv) Out of Syllabus
(v) (a) No legal formalities: This system of raising finance is simple as it does not involve legal formalities which are required in the issue of shares and debentures.
(b) Economical: It is economical because the interest paid on deposits is usually less than the interest rate charged by banks and special financial institutions in advancing money. Moreover, deposits are returned whenever their need is not felt.
(c) Higher dividends: The company can adopt the policy of trading on equity if the company is earning more than the fate of interest to its public deposits. The company can pay a higher dividend to its shareholders and create a better reputation in the market.
(vi) (a) Principles of Management are Universal.
(b) Principles of Management are Flexible.
(vii) (a) Supervision
(b) communication
(c) Leadership
(d) Motivation
(viii) Out of syllabus
(ix) (a) Collection and Payment of Credit Instruments:
Banks collect and pay various credit instruments like cheques, bills of exchange, promissory notes, etc.
(b) Purchasing and Sale of Securities:
Banks undertake to purchase and sale of various securities like shares, stocks, bonds, debentures etc. on behalf of their customers. Banks neither give any advice to their customers regarding these investments nor levy any charge on them for their service, but simply perform the function of a broker.
(x) Feedback is essential in communication so as to know whether the recipient has understood the message in the same terms as intended by the sender and whether he agrees to that message or not. Receivers are not just passive absorbers of messages. They receive the message and respond to the subject matter about what they have understood. This response of a receiver to the sender’s message is called Feedback. Sometimes feedback could be a non-verbal, smiles, sighs and other times, it is oral. It can also be written like replying to an e-mail. etc.
(xi) Out of syllabus
(xii) Out of syllabus
(xiii) Out of syllabus
(xiv) The integration concept of management involves coordination of human and non-living resources into effective operating unit for the achievement of organizational objects.
(xv) Two Physical supply functions of marketing are:
(a) Storage
(b) Warehousing and storage.
Part – II
(Answer Any Seven Questions)
Question 2.
(a) Explain any four advantages of a Public Limited Company over a Private Limited Company. [4]
(b) Briefly explain any three merits and any three demerits of a Gov eminent Company. [6]
Answer:
(a) Out of syllabus
(b) Out of syllabus
Question 3.
(a) What are the additional requirements that a public limited company has to fulfil after its incorporation, in order to obtain a certificate of commencement? [4]
(b) Enumerate the functions of a Promoter. [6]
Answer:
(a) Out of Syllabus.
(b) Out of Syllabus.
Question 4.
(a) Give any four difference between a managing director and a manager. [4]
(b) Explain any six circumstances under which the office of a director falls vacant. [6|
Answer:
(a) Out of Syllabus.
(b) Out of Syllabus.
Question 5.
(a) Explain any four advantages of Mutual Funds. [4]
(b) What is fixed capital? Discuss any four factors affecting the fixed capital requirement of a Joint Stock Company. [6]
Answer:
(a) Out of Syllabus.
(b) Fixed capital consists of land, buildings, plant, machinery’, fixtures or any other property that is permanently committed to the business. (Example, for the last item is the regular working capital). These assets are not fixed in the sense of their value but fixed in the sense that they are committed to the business for a long period of time and difficult to be converted into cash in a short period. Fixed capital is usually highly specialized and if the business does not earn the minimum required rate of profits, these assets cannot be disposed of except at a loss. The fixed asset is needed to carry on profitable operations over a long period of time.
Factors affecting the requirement of fixed capital:
1. The scale of Operations:
Larger the spread of business activities, greater is the need for fixed capital. If a manufacturing enterprise is operating on a small scale, it will require less amount of fixed capital. On the other hand, a large-scale manufacturing enterprise will need relatively more amount of fixed capital.
2. Choice of Technique:
Those manufacturing enterprises which make use of modern and automatic machines need a large amount of fixed capital. On the other hand, those enterprises in which production is carried out mainly through manual labour need for fixed capital is very little.
3. Technology Upgradation:
There are some businesses where a fixed asset is used and which does require immediate change. These days computer technology is undergoing rapid changes. Therefore, those companies whose business is computer-based need more fixed capital.
4. Growth Prospects:
There are two types of organisations from the point of view of growth:
- Such organisations, which have no possibility of growth. They do not need additional fixed capital in future,
- Such organisations have more possibilities of growth. They need more additional fixed capital. Such organisations make a choice of the sources of finance well in advance so that in case of need additional finance can be made available.
Question 6.
Explain the steps involved in the process of personal selling. [10]
Answer:
Out of Syllabus.
Question 7.
(a) Define planning. Write any three limitations of planning. [4]
(b) Explain the importance of management in modem times. [6]
Answer:
(a) Planning means looking ahead and chalking out future courses of action to be followed. It is a preparatory step. It is a systematic activity which determines when, how and who is going to perform a specific job. Planning is a detailed programme regarding future courses of action.
Limitations of Planning:
Rigidity
- Planning has a tendency to make administration inflexible.
- Planning implies prior determination of policies, procedures and programmes and strict adherence to them in all circumstances.
- There is no scope for individual freedom.
- The development of employees is highly doubted because of which management might have faced a lot of difficulties in future.
- Planning therefore introduces inelasticity’ and discourages individual initiative and experimentation.
Misdirected Planning
- Planning may be used to serve individual interests rather than the interest of the enterprise.
- Attempts can be made to influence the setting of objectives, formulation of plans and programmes to suit one’s own requirement rather than that of the whole organization.
- The machinery of planning can never be freed of bias. Every planner has his own likes, dislikes, preferences, attitudes and interests which is reflected in planning.
Time-consuming
- Planning is a time-consuming process because it involves the collection of information, it’s analysis and interpretation thereof. This entire process takes a lot of time specially where there are a number of alternatives available.
- Therefore planning is not suitable during emergency or crisis when quick decisions are required.
(b) The significance of management in the modem business world has increased tremendously due to the following challenges.
- Growing size and complexity of the business.
- The increasing specialization of work.
- Cutthroat competition in the market.
- Growing unionization of labour.
- Sophisticated and capital intensive technology.
- The increasing complexity of business decisions.
- Need for research and development.
- Need for optimum utilization of scarce resources
Management is equally important at the national level. It is an agent of change and economic growth. The prosperity, power and prestige of a nation depend upon the competence and dedication of its managers and administrators.
Question 8.
(a) Give any four advantages of written communication. [4]
(b) Explain any six principles of effective communication. [6]
Answer:
(a) Out of syllabus
(b) Out of syllabus
Question 9.
(a) Explain any four objectives of Marketing. [ 4 ]
(b) Describe any four departments of an Advertising Agency. [6]
Answer :
(a) Objectives of Marketing:
(i) To Increase Sales
One of the most important goals of marketing for-profit entities is driving business and increasing sales. Marketing needs a good return on investment – meaning the increase in sales should significantly exceed the cost of marketing – and should, therefore, be specific.
(ii) To Improve Product Awareness
A marketing effort can be focused on reviving or invigorating interest in a product that has been on the market for a long time or about which people have long-standing attitudes.
(iii) To Establish in the Industry
A new organization finds it extremely difficult to be heard in a crowded market place, with a public distracted by many stimuli. It has to induce all efforts by means of marketing activities to be heard in the market place.
(iv) Brand Management
Maintaining a place in the mind of the public takes work, and some marketing efforts are simply aimed to maintain prominence in the public space. Major organizations known worldwide often run ads that simply use images and tone to remind consumers of the brand, rather than promote a particular product or service.
(b) Out of syllabus
Question 10.
Write short notes on:
(a) Marketing Research. [4]
(b) Informal Communication. [3]
(c) Staffing as a function of management. [3]
Answer:
(a) Marketing research is a systematic process. It first collects data about the marketing problem. Secondly, it records this data. Then it analyses this data and draws conclusions about it. After that, it gives suggestions for solving the marketing-problem. So, marketing research helps to solve marketing problems quickly, correctly and systematically.
Marketing research collects full information about consumers. It finds out the needs and expectations of the consumers. So, the company produces goods according to the needs and expectations of the consumers.
(b) Out of syllabus
(c) Staff is an important managerial function -Staffing function is the most important managerial act along with planning, organizing, directing and controlling. The operations of these four functions depend upon the manpower which is available through staffing function.
Staffing is a pervasive activity- As staffing function is carried out by all managers and in all types of concerns where business activities are carried out.