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WorksheetsCommerce and Business Multiple Choice Worksheet
Total questions: 62
Worksheet time: 31mins
A financial interest of a Credit in a public company is a
Profit
shares
debenture
dividend
Assets that can easily be converted to cash are known as ______
Liquid capital
capital employed
reserved capital
working capital
Another name for debenture is
bonds
conversation stock
loan stock
shareholding
If Mr Peter Trading Company's assets is valued at 1,000anditsliabilitiesat 560. What is its capital?
$400
$560
$1560
$440
The following are examples of intangible asset except
Patent
trademark
stock
goodwill
What is the purpose of a letter of credit?
Guaranteeing payment to the buyer
Guaranteeing payment to the seller
Guaranteeing payment to the issuing bank
selecting the best seller
What is the main characteristic of debentures?
They represent ownership in a company
They have a fixed maturity date
They are physical paper documents
they are friends to the company
Use the following information to answer questions 12-13: Opening stock: 4,000 Return inward: ₦6,000 Closing stock: 12,000 Purchases: 17,000 Sale: 50,000 What is the average stock?
₦8,000
₦16,000
₦8,500
₦5,000
Use the following information to answer questions 12-13: Opening stock: 4,000 Return inward: ₦6,000 Closing stock: 12,000 Purchases: 17,000 Sale: 50,000 13. The net sales is
₦8,000
₦16,000
₦44,000
₦65,000
How are vouchers commonly used?
To guarantee loan repayments
to deliver goods
To issue shares in a company
To track financial transactions
Loans and overdrafts are credit facilities granted to people who have
fixed accounts
savings accounts
current accounts
bank account
Which of the following makes a Credit sales different from hire purchase
Possession of goods is immediate
Installment settlement of price
Option to buy is available for full payment
Contract can be terminated by either party
Which of the following is a disadvantage of credit sales to buyers?
Contract can be terminated by either party
Immediate ownership of goods
No interest charges
Flexible payment options
One of these is not a credit instrument
Cheque
Bill of exchange
promissory note
Credit card
The major advantage of credit sale is that it
promotes business
expands the business
increases sales
reduces sales
Which of these is the correct formula for calculating working capital?
Current assets – current liabilities.
Current assets + current liabilities.
Current assets - inventory - accounts payable.
Total asset - total liability
The type of transport best suited for moving bulky, non-perishable goods like coal and timber over long distances by land is...
Air transport
Road transport
Rail transport
Pipeline
The insurance principle that allows the insurer to take over the rights of the insured against a third party after settling a claim is...
Indemnity
Contribution
Proximate Cause
Subrogation
Which of the following is a function of the Nigerian Ports Authority (NPA)?
Collecting customs duties
Providing and maintaining port facilities
Insuring ships and cargo
Manufacturing ships
A document sent by a seller to a buyer to correct an overcharge is a...
Credit Note
Debit Note
Invoice
Pro-forma Invoice
The main purpose of advertising is to...
reduce production costs.
create demand for a product.
eliminate competition.
fix the price of goods.
Which of the following is a modern means of communication?
Town crier
Talking drum
Courier service
The apex bank responsible for regulating the activities of other banks in a country is the...
Merchant Bank
Central Bank
Development Bank
Commercial Bank
An 'Indent' is a document used in...
Home trade
Retail trade
Wholesale trade
Foreign trade
The term 'E-commerce' refers to...
trade in electronic goods.
sending goods by electronic mail.
buying and selling goods over the internet.
using electronic-powered transport.
The main objective of commerce is to remove the hindrance of...
place
persons
exchange
production
The reward for the entrepreneur's effort in production is...
wages
rent
interest
profit
A business owned and controlled by a single person with unlimited liability is a...
Sole Proprietorship
Partnership
Public Corporation
Co-operative Society
The document that must be submitted to the Registrar-General before a company is incorporated is the...
Articles of Association
Prospectus
Memorandum of Association
Certificate of Trading
A retailer who sells only one line of goods, such as shoes, is a...
Departmental Store
Supermarket
Specialist Shop
Chain Store
The insurance principle that requires the insured to disclose all material facts is...
Utmost Good Faith
Indemnity
utmost good faith
Subrogation
A cheque that cannot be paid in cash over the counter is a...
Stale cheque
Open cheque
Bearer cheque
Crossed cheque
A warehouse used for storing imported goods on which duty has not been paid is a...
Public warehouse
Private warehouse
Bonded warehouse
State warehouse
The document that gives the holder title to the goods during sea transport is the...
Bill of Exchange
Charter Party
Bill of Lading
Mate's Receipt
The lowest rate of interest is usually charged on which source of short-term finance?
Hire Purchase
Overdraft
Trade Credit
Personal Loan
Which of the following is an advantage of a Public Limited Company over a Private Limited Company?
Simpler to form
Shares can be sold freely to the public
Less legal formality
Unlimited liability
The person who takes out an insurance policy is the...
Insured
Underwriter
Broker
Adjuster
The primary difference between a current account and a savings account is that the current account holder...
earns a higher interest rate
is not required to use a cheque book
can withdraw money frequently
is given a passbook
Buying and selling goods and services among countries is known as...
Home Trade
Domestic Trade
International Trade
Retail Trade
The activity that creates time utility by bridging the gap between production and consumption is...
Transport
Banking
Warehousing
Advertising
Which of the following is a function of the Central Bank?
Granting loans to individuals
Issuing currency
Accepting deposits from the public
Discounting bills for traders
The partner who contributes capital but takes no active part in the running of the business is a...
Active Partner
General Partner
Nominal Partner
Dormant Partner
The purpose of having an Insurable Interest is to ensure that the insured suffers an actual financial...
profit
gain
loss
risk
Retained profit is categorized as a source of...
external finance
internal finance
short-term credit
external loan
The process of making a product attractive and easy to handle is called...
Branding
Labelling
Packaging
Merchandising
A very low Inventory Turnover Ratio suggests:
High sales volume
Risk of obsolete or slow-moving stock
Efficient inventory management
Quick conversion of stock to cash
The term Turnover is primarily synonymous with:
Net Profit
Total Capital
Total Expenses
If a company's Cost of Goods Sold is ₦120,000 and its Average Stock is ₦30,000, what is its Rate of Stock Turnover?
4 times
3 times
0.25 times
150,000
Average Stock is calculated as:
Opening Stock - Closing Stock
(Opening Stock + Closing Stock) / 2
Cost of Goods Sold / Rate of Stock Turnover
Purchases - Returns Outwards
From the Accountant's perspective, capital is primarily defined as:
Total revenue earned
Goods sold by the business
Total assets minus total liabilities
Owner’s equity
Working Capital is calculated as the difference between:
Total Assets and Total Liabilities
Fixed Assets and Current Assets
Current Assets and Current Liabilities
Sales and Cost of Goods Sold or investment in the business
Fixed Capital refers to the funds used for acquiring assets that are:
easily converted to cash
long-term and durable
used up in a single production cycle
solely for non-profit purposes
Capital required to finance the day-to-day operations of a business
Fixed Capital
Loan Capital
Circulating Capital
Social Capital
Commercial banks provide credit primarily through all of the following EXCEPT:
Overdrafts
Term Loans
Hire Purchase agreements
Discounting Bills of Exchange
Which source of credit is automatically extended when a supplier allows a customer to pay for goods 30 or 60 days after delivery?
Trade Credit
Public Credit
Bank Credit
Investment Credit
The loan given for the building purposes is called
Mortgage loans
Short-term credit
Trade credit
Hire purchase
Finance loan
The following balances were extracted from the books of Alheri Ventures as at December 31, 2024:
1. Calculate:
i. Total Current Assets
What is the total current assets as at December 31, 2024?
₦250,000
₦180,000
₦320,000
₦210,000
Which of the following are examples of sales promotion tools?
Discounts and coupons
Advertising and branding
Market research and surveys
Public relations and sponsorships
Turnover is defined as:
The total sales or revenue generated by a business during a specific period.
The amount of profit earned by a business in a year.
The number of employees leaving a company in a year.
The total assets owned by a business.
Which of the following is a factor that can affect turnover?
Employee satisfaction
Weather conditions
Color of office walls
Type of company logo
Which of the following are factors to be considered before granting credit sales?
Customer's creditworthiness, payment history, and financial stability
Product price, advertising budget, and store location
Employee satisfaction, company logo design, and office furniture
Weather conditions, holiday schedule, and website color scheme
Which of the following correctly states a difference between hire purchase and deferred payment?
Ownership of goods is transferred after the last installment in hire purchase, but immediately in deferred payment.
Interest is not charged in hire purchase, but is charged in deferred payment.
Hire purchase does not require any down payment, while deferred payment does.
Deferred payment allows for return of goods, while hire purchase does not.
