IMPORTANT CONCEPTS OF COMMERCE FOR NTA NET PART 2

A condominium, usually shortened to a condo, is a type of real estate divided into several units that are each separately owned, surrounded by common areas jointly owned. Building jointly owned is called Condominium.
Numerical classification is based on numerical order. An assessment of the relative contribution of the intangible items to the aggregate intangible value based on a managerial point of view of the strategic choices, goals and positions of the firm.
Docketing is the process of making entries in the ‘Notes’ portion of a file about each Serial Number (Receipt or Issue) in the ‘Correspondence’ for its identification. In a similar manner, a receipt will be docketed in writing using red ink, across the page, with the serial number of the communication followed by its number and date and the designation/name of the sender.
Docketing is the process of making entries in the ‘Notes’ portion of a file about each Serial Number (Receipt or Issue) in the ‘Correspondence’ for its identification. In a similar manner, a receipt will be docketed in writing using red ink, across the page, with the serial number of the communication followed by its number and date and the designation/name of the sender.
Metal holders methods of filing, papers and documents are placed in metal holders in chronological order. This method is inconvenient for maintenance and outdated.
In the Bound book method of filing, all the letters and documents are passed in the book in chronological order. Whenever papers are to be filed, they are pasted on leaves of books in chronological order. Small papers of varying sizes are filled in the bound book.
Visible files are available in the form of the tray that lie flat horizontally in a cabinet. A visible file, sometimes just called a kardex, after a prominent purveyor, is a filing system for overlapping cards fixed in shallow drawers.
Strip index system is used when small information is required about customers. Strip indexing is a rarer form of indexing. Visualize a set of small strips on card stock, placed so each is visible. The strip index can hang up on a wall.
Except for life insurance generally, the maximum term of other insurance is 12 months.
The person whose risk is insured is called Insured and Assured.
Life insurance in its present form came to India from The United Kingdom.
The over-the-counter exchange of India (OTCEI) is an electronic stock exchange based in India that consists of small- and medium-sized firms aiming to gain access to the capital markets like electronic exchanges in the U.S. such as the Nasdaq, there is no central place of exchange, and all trading occurs through electronic networks.
Importing goods for the purpose of re-export is termed as Entrepot trade. If goods are imported from one country with the purpose of re-exporting to another, it is called Entrepot trade.
Office management simply means to control. It is the function of the management to organize, guide and control the whole activities of the office personnel for a common aim.
Filing is an important aspect of housekeeping. Housekeeping is crucial to safe workplaces.
The preference shares holders who have no claim for the arrears of dividend are Non-cumulative preference shares. Non-cumulative preference shares are those types of preference shares, which have the right to get a fixed rate of dividend out of the profits of the current year only. They do not carry the right to receive arrears of dividends.
The Marketing co-operatives are associations of producers for selling their products at remunerative prices. These are voluntary associations of independent producers who want to sell their output at remunerative prices.
Co-operative farming societies are voluntary associations of farmers framed to reap me benefits of large scale farming a scientific lines.
Co-operative societies have Democratic management. The society is managed by a group known as the “Board of Directors”. The members of the board of directors are the elected representatives of the society. The main purpose of a Co-operative Society is to provide service to its members.
When a transfer of shares takes place by the operation of law, it is known as Transmission of shares. The transmission of shares occurs due to the operation of law i.e. in case if the member passes away or becomes insolvent/lunatic.
The returns of shares to the company is known as the Surrender of shares. A surrender of shares means the return of shares by the shareholder to the company for cancellation. Holder in this case voluntarily abandons all his shares in favour of the company.
The optimum point is an Ideal size of a firm. The optimum firm refers to the best or ideal size of the firm. The more specifically optimum or best firm is considered as one that has set up a plant with the lowest possible cost and is also operating it at its lowest average cost point.
Unsecured debentures are debentures that are not supported by collateral security. No specific assets will be set aside against unsecured debentures. It is basically a loan without any protection. They are backed only by the general creditworthiness of the issuer. Unsecured debentures are simple debentures.
Commercial banks are the most important source of short term capital. The major portion of working capital loans is provided by commercial banks.
The first stock exchange in the world is the London stock exchange. London Stock Exchange is one of the world’s oldest stock exchanges and can trace its history back to 1571. London Stock Exchange Group was created in October 2007 when London Stock Exchange merged with Milan Stock Exchange, Borsa Italiana.
Insurance is a social device for eliminating or reducing the loss of society from certain risks. Insurance is a social device for the division of financial losses which may fall on an individual or his family on the happening of some unforeseen events. When insured, the loss arising out of the events are shared by all the insured in the form of a premium. Therefore, the risk is transferred from one individual to a group.
Economic activities are related to the Production of wealth. The primary aim of the economic activity is the production of goods and services with a view to make them available to consumers.
A written agreement signed by all partners is called Partnership Deed. A partnership deed should be duly signed by the partners, stamped & registered.
Fully paid-up shares are called Stock. Fully paid shares are shares issued for which no more money is required to be paid to the company by shareholders on the value of the shares.
The insurance business is based on the theory of probability and the law of large numbers. As the number of exposure units, or policyholders, increases, the probability is higher than the actual loss per exposure unit will equal the expected loss per exposure unit.
In order to control private sector insurance companies, the Government of India passed the IRDA Act (Insurance Regulatory and Development Authority Act, 1999) which enabled it to regulate the private sector companies in the insurance business. One chairperson and not more than 9 members of whom not more than 5 would be full-time members and they are appointed by the government. Those who have experience in life and general insurance, actuarial service, finance, economics etc., are appointed.
An office routine is a system. Routine is “a series of steps in the performance of work, each step in the series being performed in the same order and in the same way every time.”
One-man-one-vote – is the principle adopted by Co-operative Societies. A cooperative society is formally used by people with limited means. The principle of one man one vote discourages members to invest large amounts in society.
Dividends declared by a company may be paid in cash only. On the date of payment, the company reverses the dividend payable with a debit entry and credits its cash account for the respective cash outflow. Cash dividends do not affect a company’s income statement. However, they shrink a company’s shareholders’ equity and cash balance by the same amount.
In the case of private companies, the maximum limit has been increased by the new Companies Act, 2013 from 50 to 200. There is however no maximum limit on the no. of members in a public company.
The moral beliefs held by an individual is known as Values. Moral values are usually communal and shared by the public in general, thus if there is no agreement among community members no moral values will be established.
The interests and rights of customers are given top priority in The Vendor Model. A number of vendors produce and sell products that are designed to support credit-risk measurement and management functions within financial institutions. Such products may comprise risk measurement models, data, or systems developed by external commercial entities.
The oldest form of business organization is the sole proprietorship. When the ownership and management of a business are in control of one individual the form of business is called sole proprietorship.
Registration of partnership is optional under the Indian partnership act. Registration of partnership firm may be done at any time – before starting a business or anytime during the continuation of the partnership.
The most important advantage of a joint-stock company form of business organization is that members can conveniently transfer their shares. The shares of a company are transferable. Also, in the case of a listed public company they can also be sold in the market and be converted to cash.
In the cooperative organization, the voting rights of members are equal, irrespective of the amount of capital contribution.
Localized materials are available at certain places.
A project, which may not add to the existing profits, should be financed by preference share capital. Preference shares share in a company that are owned by people who have the right to receive part of the company’s profits before the holders of ordinary shares are paid. They also have the right to have their capital repaid if the company fails and has to close.
The management of the company is entrusted to the Board of Directors. A “Managing Director” means a Director who, by virtue of Articles of Association of a Company or an agreement with the company or a resolution passed in its general meeting, or by its Board of Directors, is entrusted with substantial powers of management of affairs of the company.
Contango charge is paid by bull speculator to bear speculator. When the spot price is higher than the futures price, the market is said to be in backwardation. It is often called ‘normal backwardation’ as the futures buyer is rewarded for the risk he takes off the producer. If the spot price is lower than the futures price, the market is in contango”.
Register of members is a statutory book. The statutory books of the company must be maintained and kept at the company’s registered office (or an alternative location notified to Companies House) where they can be inspected.
Business risks can be reduced. Business owners need to take control of their companies, assess the risks inherent in both their firms and industries and determine how to best reduce these risks.
In case of dissolution of the partnership, the business of the firm does not come to an end. Dissolution of partnership changes the mutual relations of the partners.
Earning Goodwill is need for business ethics. Business ethics are required to protect the interest of employees, shareholders, competitors, dealers, suppliers, etc. It protects them from exploitation through unfair trade practices.

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