JAMB Commerce 1995 past questions and answers

What are the factors with which commercial undertakings can be distinguished?
I Size of the undertakings
II Profits generated
III Forms of ownership
IV Location of the undertakings.

1. A.I and II only
2. B.I and III only
3. C.II and III only
4. D.III and IV only.

The development of commercial activities in Nigeria was facilitated largely by

1. A.a good transport system
2. B.the indigenization decree
3. C.a convenient medium of exchange
4. D.a high level of production.

In which of the following sets of occupations can an industrial worker be found?

1. A.extraction, commerce and construction
2. B.manufacturing, extraction and banking
3. C.construction, quarrying and insurance
4. D.manufacturing, extraction and construction.

Construction activities include the building of houses and roads as well as

1. A.bricklaying
2. B.shoemaking
3. C.blacksmithing
4. D.car assembling.

If a partnership deed is silent on how profits are to be shared, partners share profits

1. A.in the ratio of the value of business secured by each partner for the partnership
2. B.in the ratio of partners' capital contributions
3. C.in an equal proportion, irrespective of partners' capital contributions
4. D.according to duties performed by each partner.

Which of the following information is contained in the Articles of Association of a limited liability company?

1. A.Rights and obligations of directors
2. B.Objectives of the company
3. C.Amount of share capital
4. D.Limitation of liability of shareholders.

The merger of two companies producing the same type of products is an example of

1. A.vertical integration
2. B.horizontal integration
3. C.lateral merger
4. D.an acquisition.

One of the implications of the incorporation of a company is that

1. A.it is more difficult for the company to raise loans
2. B.the company can sue but cannot be sued
3. C.the company's property becomes distinguished from that of its members
4. D.its members become liable for all the debts of the company.

The main advantage of a sole trader is the freedom to

1. A.employ anyone he likes
2. B.seek advice from any source
3. C.take quick decisions
4. D.plough all the profits back into the business.

In the case of a voluntary liquidation of a business, the receiver is appointed by the

1. A.creditors
2. B.debtors
3. C.directors
4. D.shareholders.

When a company uses more of loans than equity to finance its business, the company is said to be

1. A.bankrupt
2. B.solvent
3. C.highly geared
4. D.in a strong liquid position.

A public limited company can raise long-term loans through

1. A.the capital market
2. B.the money market
3. C.bank overdrafts
4. D.discount houses.

Factoring is a trade debt term used when the factor buys all the trade debts of the

1. A.importers
2. B.exporters
3. C.nation
4. D.customers.

The financial index which compares current assets directly with current liabilities is known as current

1. A.turnover
2. B.capital
3. C.ratio
4. D.balance

Rights issue means the

1. A.issue of shares to directors of a company on favourable terms
2. B.issue of shares by a company only to founders of the company
3. C.right of shareholders to vote on any issue
4. D.issue of shares to shareholders on favourable terms.

Profit that is expressed as a percentage of cost of goods sold is referred to as

1. A.margin
2. B.mark-up
3. C.gain percent
4. D.gross profit.

Given:
Opening stock ₦40 000
Purchases ₦115 000
Closing stock ₦60 000
Sales ₦250 000
What is the cost of goods sold?

1. A.₦155 000
2. B.₦95 000
3. C.₦50 000
4. D.₦30 000

In the channel of distribution, which of the following sets is entirely made up of middlemen?

1. A.Wholesalers, retailers and agents
2. B.Manufacturers, consumers and retailers
3. C.Wholesalers, agents and consumers
4. D.Retailers, manufacturers and wholesalers

Goods imported into a country for the purpose of re-exporting attracts a rebate known as

1. A.customs draw back
2. B.export royalty
3. C.incentive
4. D.export rebate.

Most foreign trade transactions are paid through the use of

1. A.central bank cheques
2. B.bank drafts drawn by commercial banks on their foreign branches
3. C.irrevocable and confirmed letters of credit
4. D.letters of credit authenticated by the embassies of the respective countries.

RRF as a scheme introduced by the central bank of Nigeria means

1. A.recording and Rediscounting Facility
2. B.refinancing and Recording Facility
3. C.refinancing and Rediscounting Facility
4. D.refinancing and Reinvesting Facility.

Which of the following gives the correct order in which the listed documents are used?

1. A.debit note, order, delivery note, invoice and statement
2. B.order, delivery note, invoice, debit note, statement
3. C.statement, order, invoice, delivery note and debit note
4. D.invoice, order, statement, debit note and delivery note.

Freight note is a document

1. A.used by government to transport goods from one country to another
2. B.issued by a shipping company giving details of charges
3. C.used for payment of imported goods
4. D.given by an importer to pay for goods at a future period.

Spot market goods are those which are available for

1. A.immediate delivery
2. B.short-term delivery
3. C.long-term delivery
4. D.end of year delivery.

The main advantage of road transport is that it is

1. A.convenient and flexible
2. B.cheap and direct
3. C.common and fast
4. D.safe and available.

The practice by which an insurance company accepts a very large risk and later shares it with other insurance companies is called

1. A.subrogation
2. B.contribution
3. C.re-insurance
4. D.indemnity.

Berne Union is also known as

1. A.International Credit Union
2. B.International Documentary Credit Union
3. C.international Union of Credit and Investment Insurers
4. D.export Credit Guarantee Scheme.

Which of the following sets of items was used for exchange in Nigeria before money was introduced?

1. A.Cowries, iron rods, brass rods and copper wires
2. B.Iron rods, copper rods, manilla and cowries
3. C.Cowries, manilla, brass rods and copper wires
4. D.Copper wires, brass wires, cowries, and iron rods.

A major liability of a commercial bank arises from

1. A.customers' deposits
2. B.loans and advances
3. C.overdrafts
4. D.staff allowances.

A bank statement is a document

1. A.ordering a bank to pay on demand a stated sum of money
2. B.containing records of receipts, payments and balance on an account
3. C.used for paying money into a bank account
4. D.used for regular withdrawal of money from a savings account.

Which of the following is NOT a function of the stock exchange market?

1. A.providing long-term loans to large scale enterprises
2. B.encouraging people to buy shares and thereby providing capital for investment
3. C.providing means of assessing the value of a firm's assets
4. D.enabling firms to wind-up quickly in times of difficulties.

The breaking down of a market into separate and identifiable elements each with its own special product requirements is known as market

1. A.differentiation
2. B.segmentation
3. C.penetration
4. D.identification.

Taking a new product to a particular part of a country to test the reaction of consumers to the product is referred to as

1. A.sales promotion
2. B.sampling
3. C.merchandizing
4. D.advertising.

A manufacturer can make his product distinguishable from those of other competitors by

1. A.providing catalogues for his wholesalers
2. B.aggressive sales promotion
3. C.branding and packaging the product
4. D.selling the product at a much lower price.

Which of the following are forms of sales promotion?

1. A.advertising, personal selling and publicity
2. B.advertising, market skimming and publicity
3. C.personal selling, packaging and publicity
4. D.advertising, packaging and publicity.

A disadvantage of personal selling is that it

1. A.increases a company's operating costs
2. B.decreases a company's operating costs
3. C.increases a company's number of customers
4. D.reduces a company's area of patronage.

Consumer sovereignty means that the consumer is

1. A.a citizen
2. B.always independent
3. C.always wrong
4. D.always right.

When an industry or company is nationalized, the state becomes

1. A.the majority shareholder
2. B.the minority shareholder
3. C.the only shareholder
4. D.an equal shareholder with other individuals.

The Federal Government made efforts at rendering public enterprises more efficient and profit-oriented through the process of

1. A.privatization
2. B.commercialization
3. C.indigenization
4. D.nationalization.

Which of the following organizations represents those who engage labour in Nigeria?

1. A.Nigerian Labour Congress
2. B.Nigerian Employers Consultative Association
3. C.Manufacturers Association of Nigeria
4. D.Nigerian Union of Local Government Employees.

The practice of assessing employees for payment or advancement according to their observed achievement is called

1. A.employee ranking
2. B.merit rating
3. C.job grading
4. D.employee evaluation.

Motivation is an essential element in management because it

1. A.leads to the improvement of staff welfare
2. B.encourages individuals to work towards achieving the organization's objectives
3. C.reduces friction among employees in the process of achieving the organization's objectives
4. D.helps to eliminate industrial disharmony.

A firm's organizational structure would change if

1. A.one of the major partners dies
2. B.there is excessive competition
3. C.there is seasonal variation in demand
4. D.the scope of business operation changes.

The secretariat of the Niger Basin Commission is located at

1. A.Ouagadougou, Burkina Faso
2. B.Abuja, Nigeria
3. C.Niamey, Niger
4. D.Bamako, Mali.