revision

1. _________________ are the things what men cannot do without e.g. Clothing and _________________are the things what men desires to have like Video games


2. The exchange of one type of goods for another is called ________________________

3. Commerce can be divided into ____________________ and ___________________

4. _________________________________ are trade between others countries

5. Buying and selling goods inside the country is called _______________________

6. _____________________________ are the people who involved in helping to distribute goods from the producer to the consumer

7. The _____________________ production generally involves with manufacturing and construction where they create a finished or usable product

8. _______________ is the buying of goods from foreign countries and sale it locally

test your knowledge

1. Name THREE sources of capital for a sole trader


2. List out THREE function of a commercial bank


3. Dyg. Aishah is a sole trade who deals in sundry goods in her village

    a. State one feature or characteristic of her business

    b. List one advantage of the business

    c. List one disadvantage of the business


4. List out THREE features of Saving account


5. Explain THREE reasons why a cheque may be dishonoured by the bank


6. Define the following:-12. With the help of a diagram, explain the differences between a general crossing and special crossing of a cheque

     a. Unlimited Liability

     b. Partnership

     c. Limited Capital


7..Normally a businessman operates a current account in commercial banks. Give THREE reasons for this


8.Write down any THREE services provided by a commercial bank other than deposit and withdrawal of money


9. Name the service a bank might offer to:


a. Adam who needs to deposit money after the bank hours

b  Julie who wish to earn a high interest on her spare money

c. Danny who wish to send some money from Brunei to John in UK


10. List down THREE disadvantages of Partnerships


11.    List down THREE characteristics of Partnership
 

12. Explain the following terms related to cheque
a. Drawers
b. Drawee
c. Payee

test your knowledge

1. Regular payments made by a bank on behalf of a customer are called


A. Standing orders

B. Credit clearings

C. Deferred payments

D. Monthly statements



2. Consumers in Brunei Darussalam generally use credit cards to purchase goods. The credit card allows the card holder to

A. Have a free after-sale service

B. A discount on good purchased

C. Purchase goods on credit without limit

D. Purchase goods on credit with limit



3. A sole proprietorship is owned by ___________ owner(s)

A. One

B. Two

C. Fifty

D. Twenty



4. The institution which provides many valuable financial services for people engaged in business is

A. Central bank

B. Commercial Bank

C. Brunei Investment Agency

D. Department of Telecommunications



5. A cheque will be considered stale after _________ from the date of issuance

A. One week

B. One month

C. Six months

D. Twelve months



6. Which one of the following is NOT an example of sole proprietorship

A. Food stall

B. Sundry shop

C. Beauty saloon

D. Architects’ firm



7. A place where a person can put important items such jewellery, shares and gold is called a/an ______________ box

A. Night Safe

B. Safe Deposit

C. Fixed Deposit

D. Automatic Safe



8. All of the following are functions of Central Bank except,

A. Print Money

B. Accepts and keeps money safely for the public

C. Regulate the activities of the commercial banks

D. Banker and Financial advisor to the government



9. The person who signs a cheque is called ___________ of the cheque

A. Payee

B. Owner

C. Drawer

D. Drawee



10. Hafiz owns a motorcar repair workshop. He has three other mechanics who are working for him. His business is classified under

A. Partnership

B. Sole proprietorship

C. Public limited company

D. Private limited company



11. A cheque which is date in the future is called

A. Antedated

B. Pre - date

C. Post – date

D. Future date



12. In partnership, the profit and losses are divided among the partners depending on the partnership agreement. But if there no agreement is made, the profit and losses are

A. Equally divided among the partner

B. Equally divided among the Broad of Directors

C. Given only to the founder of the business

D. Given to the Bank since no agreement was made



13. The form of cheque which is the least safe is a

A. Order cheque

B. Bearer cheque

C. Special Crossing cheque

D. General Crossing cheque



14. Which one of the following is a real account?

A. Sales

B. Salaries

C. Furniture

D. Ahmad (debtors)



15. When cash is received, cash account will be

A. Closed

B. Debited

C. Credited

D. Balanced



16. Which one of the following is an example of Central Bank

A. HSBC

B. Baiduri

C. Bank Negara

D. Islamic Bank of Brunei



17. Debtors, Creditors, Capital and Drawing account are example of ______________ account

A. Real

B. Goods

C. Personal

D. Impersonal



18. The owners of a limited liability company are know as

A. Partners

B. Directors

C. Proprietors

D. Shareholders



19. In Cash book, “Paid into bank from office cash” we will

A. Debit Cash account and Debit Bank account

B. Debit Bank account and Credit Cash account

C. Credit Bank account and Debit Office account

D. Credit Office account and Debit Bank account



20. When $500 cash is received, the amount should be _________ in the __________ in the Cash Book

A. Debit, Cash column

B. Debit, Bank column

C. Credit, Cash column

D. Credit, Bank column



21. Account referring to a person are called ____________ account

A. Real

B. Goods

C. Personal

D. Nominal



22. The double entry for “withdrew of goods for personal use” are

A. Debit - Drawing account, Credit - Sales account

B. Debit - Drawing account, Credit - Purchase account

C. Debit - Withdrawal account, Credit - Sales account

D. Debit - Withdrawal account, Credit - Sales account



23. A limited company is managed by

A. Partners

B. Creditors

C. Shareholders

D. Board of directors



24. When goods are purchase, the accounts that needs to be debited is ___________ account

A. Cash

B. Goods

C. Capital

D. Purchases



25. The most serious disadvantages a sole trader may encounter is ________________

A. Difficulties in locating his business

B. Expenses incurred in purchasing stocks

C. Cost of keeping accounts all by himself

D. Personal liability for debts incurred by his business



26. The distribution of the profits of a limited company to its shareholder is known as ___________

A. Profit

B. Capital

C. Interest

D. Dividend



27. The maximum number of partners in a partnership are

A. Two

B. Fifty

C. Seven

D. Twenty



28. Examples of goods account are purchases and _____________ account

A. Sales

B. Fixed

C. Nominal

D. Personal



29. What ATM stand for

A. Auto Teller Machine

B. Auto Talker Machine

C. Audi Teller Machine

D. Audi Talker Machine



30. Only ___________ account holder can withdraw their money by using cheque

A. Saving

B. Current

C. Fixed Deposit

D. Saving and Current

Channels of Distribution

1. Manufacturer to Consumer


(When a manufacturer sells direct to the consumer)


 This occurs when customers post orders for books or magazines direct to the publishers who then send them their orders direct. This ensures the publisher of selling to as many people as possible and can increase sale. Customers will also benefit since they’re assured of getting the latest issue or publication


 It also occurs when something is made especially for a customer e.g. a suit, made-to-order furniture. An individuality in design normally demand us to pay more than what we have to pay for the same type of good which is mass produced. Example:- tailoring, saloons and interior furnishing


 It also occurs in expensive and highly and specialized goods which are purchased only occasionally by the government or big private companies. Examples:- aeroplanes, ships, railway rolling stock



2. Manufacturer Cooperative to wholesaler [Rebate price Retail price]


Members Public

 When a manufacturer sells to a cooperative wholesaler who in turn supplies the cooperative retail in his district


 Members of the public, including the members of such cooperative retail shop then buy the goods from them

 Cooperative members are able to buy the goods at a rebate

3. Manufacturer to Retailers {Retail price (with a discount)}



Public

(When a manufacturer sells to the retailers who in turn sell to the consumers)



 Most large retailers like supermarket, department store have the financial resources to buy in bulk direct from the manufacturers. The main advantage of bulk buying is the large discounts so that they can offer a greater variety of goods at competitive price

 In many cases, the retail shop is owned by the manufacturers, for example, selling footwear and medicine. These manufactures have large resources to open their own retail outlets

 Sometime, the retailers may be “tied” to the manufacture. Example petrol stations selling only one brand of petrol



4. Manufacturer to Wholesaler Retailers

(When a manufacturer sells to a wholesaler who then sells to the retailers in smaller quantities. Then the retailers who in turn sell to the customers)

 It occurs when the producers themselves are unable to market the excess goods themselves because of financial constraints or the lack of access to widely markets due to lack of contacts, commercial know-how

 For example, the rural producers who produce like fish, paid, vegetables and so on, they are lack in packing specialty therefore they sent their product to the wholesaler who can pack them properly and transport them quickly to the big cities or town (in the same countries or overseas), where they sold to various retailer who in turn sell them to the consumers


 Locally manufactured goods like ordinary household essentials which are stocked by small retailers are often distributed in this way since the retailers buy in too small a quantity to make it viable for the manufacturer to sell direct to them


 Goods which sold this way become more expensive because of the cost of distribution and profit margins required by the wholesaler and retailer. However, consumers can be benefit from the wide variety of goods produced by many producer


 The producer is free to devote all his attention and resource in producing better quality of goods since the marketing has been done by the wholesaler

 The retailer needs little capital as he needs to maintain only a small stock. This is because it is easy for him to get new and hence fresher stocks from the supplier (wholesaler) once his stock is depleted



5. Manufacturer to Sole Agent

 When an overseas manufacturer appoints a sole agent in the home market to manage the sale and distribution of his goods as well as to provide after-sale services

 The sole agent is responsible for getting reliable retailers to market the goods throughout the country. Example: Sell imported cars, cosmetics and electrical goods



AGENTS and THEIR WORK


 An agent is a person who deals with goods on the behalf of another person is called the principal

 There are two type of agents

i) Factor

ii) Broker

Differences between Factor and Broker

1.

factor:-
Has possession of goods

broker:-
No possession of goods therefore have to bring buyer and seller together

2.

factor:=
Can sell the goods in his own name

broker:-
Does not sell goods in his own name


3.

factor:-
Receive payment and issue valid receipt

broker:-
Not allowed to receive payment or issue receipt

4.

factors:-
Keep whatever profit he made

broker:-
Receive commission
 5.
 
factor:-
Has legal claim
 
broker;-
No legal claim of goods
 
 
 
Factors that influence the choice of the type of channel of distribution




1. Nature of goods to be marketed

 Goods that is perishable, e.g. cakes and bread, it must be sold quickly as possible. Normally it sold directly to the consumers through the producer’s own retail outlets or channelled it nearby retail outlet as soon as it produced

 Goods that can last longer can be handled by more intermediaries in order to ensure a larger market



2. Size of market

 Producers who wanted their goods marketed as widely as possible, they did not want to saddle themselves with problems of managing their own retail outlets and normally they sold their goods to wholesalers. Therefore, the bigger the market, the larger will be the number of intermediaries needed

 Producers who desired to a small exclusive clientele may opened their own retail outlets e.g. boutiques which sell expensive, exclusively designed ready made garments



3. Quantity of goods bought

 Most producers are normally willing to accept larger retailers or wholesalers than the small retailer. This is largely due to the orders from the small retailers which is normally in small quantity and involved a lot of paperwork


4. Size of the firm producing the goods

 A very big firm which had the financial and human resources normally not only produce the goods but also set up their own retail outlets

 Small – sized producer may prefer to concentrate the technical aspects of producing and leave the marketing of goods to others

test your knowledge

Advertising


Underline the correct answer


1. The most effective way to advertise at night is through the use of

a. Posters

b. Hoardings

c. Neon lights

d. Sky-writing by an airplane



2. The most effective way for a large supermarket in Brunei to advertise special offers, the name of the products and their prices for the week is to advertise

a. In the cinema

b. In the newspaper

c. Over the radio

d. Over the television



3. The best way for a manufactures of toys to advertise is to insert its advertisement in

a. Story book

b. Newspapers

c. Women’s magazines

d. Children magazines and comics



4. All of the following are the functions of advertisement except

a. Consumers come to know about the new product

b. Advertising is can be successful thus brings more profit to the manufacturer

c. Advertising brings employment to thousands of artists, models, photographers, etc

d. It encourages the manufacturers to improve and maintain the high quality of their products to keep up the competition



5. Which one of the followings are the dangers of advertising to the consumers:

a. Wider choice

b. Necessary purchases

c. Misled by false claims

d. Rational in their buying




Short Answer Questions

1. State THREE advantages and TWO disadvantages of advertising to consumers

2. Distinguish between informative advertising and persuasive advertising

3. State THREE advantages and  TWO disadvantages of advertising goods in the newspaper

4. List down FIVE types of advertising media

5. For each of the following items, state the devices commonly used by advertisers to promote the sale of their products:


a. Cosmetics

b. Baby milk powder

c. Household detergent

d. Agricultural machine

e. Perfume

Considerations governing the choice of media

Considerations governing the choice of media



1. Nature of the product or service

 The medium of chosen must fit the product or message to be advertised

 Goods (especially new ones) that require explanations and demonstrations are best advertised at trade fair

 Alternatively travelling salesperson can visit homes to demonstrate the use of household appliances

 Women dresses are best shown in colour magazines



2. Target

 This is the group of consumers the advertisement is aimed at, for example, teenagers, housewives, young men and women or other professionals

 For example, women’s magazine have advertisements of cosmetics, jewellery, household items and other products which women needs

 The radio and television are the most effective media for reaching children



3. Extent of market: local, national, international

 If wide coverage is needed for a certain advertisement, the national newspapers will be a more popular media than the local newspapers

 However, the local newspapers will be useful for tapping the local market

 Television is the most popular medium for broadcasting any advertising message to the mass market which includes both the literate and the illiterate



4. Cost

 The cost of the advertising medium should be considered in relation to the amount of funds available and the circulation of the medium

 Example, the amount of funds available could rule out TV but the advertiser can put small advertisement in the newspapers instead

 However, the advertiser should consider the costs when making a choice

 Although advertising on television may be expensive, the size of the audience is will reach is great, resulting in lower cost per exposure



Advertising Agencies

 Advertising agencies are the specialists or experts who undertake the task of advertising for the producers


 An advertising agency has 3 main functions:

1. Creating the advertisement

2. Producing the advertisement

3. Placing the advertisement



 They also give additional services like:

1. Market research – they provide information on who are they aiming at

2. Advice – Best medium of advertising use for the product



 Advertising agency has 4 departments

1. Account Services department

 “Account” in advertising terminology means clients’ business or customers

 The account director heads this division

 He is assisted by a number of account executives who communicate with the clients and handle all the work on the clients’ behalf

 The account executive is responsible for taking “briefs” (information pertaining to the clients’ business – competitors, marketing strategies, sales target, etc) from the clients and discussing problems with the departments concerned

 An advertising plan is then prepared and this is sown to the client for approval

 The executive has to supervise and see to that working of the plan by checking on the progress of the various department



2. Creative department

 This department is controlled by a creative director and it comprises two sections

i) Copy section – the copywriters in this section transform campaign ideas and creative themes into writing

ii) Art Studio – the art director and his artists will be responsible for presenting the visual ideas for the advertising campaign



3. Media department

 Media plans that are appropriate to the advertising campaign are prepared in this department

 The media planners ensure that each advertiser’s budget is spent in such a way that his message reaches the required market as effectively and economically as possible

 It is the responsibility of this department to represent the agency in buying space and time from the media owners e.g. independent television and radio contractors and owners of outdoor media like bulletin boards, painted wall signs, hoardings or painted advertisement on delivery van or buses



4. Production department

 When the layout comprising the right words and pictures has been prepared, the finished artwork (photographs, drawings and sometimes lettering) must be produce

 This may be done in the agency’s studio in the above department or undertaken outside

Test your knowledge

1. List out THREE function of a commercial bank


2. a) What is barter trade?


b) Give TWO difficulty faced by the barter trade system?


3. Sheila has just started a small retail business. She opened a current account with HSBC. State three advantages of opening a current account with HSBC


4. Britney and Jennifer decide to start a business. Advice them on THREE differences between a partnership and a private limited companies


5. List THREE features of department stores


6. Explain the following terms related to cheque

a. Drawer

b. Drawee

c. Payee


7. List down THREE main functions of money


8. Differentiate between extraction occupation and the direct service occupation


9. List THREE advantages of using television as a medium of advertising for promoting a new brand shampoo


10. Commerce is the study of business activities. It is mainly into aids to trade. Name and explain THREE aids to trade