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WAEC Commerce 1991 (August) Question 53

Question 53

Purchase and Sale of Goods

When a seller sends a pro-forma invoice to a potential customer, it is

  1. A.an indication that the seller is out of business
  2. B.an indication that the goods are out of stock
  3. C.a polite way of asking him to return the goods already purchased
  4. D.an invitation to the purchaser to buy on hire-purchase
  5. E.an indication that credit will not be granted
Show the answer and explanation

Answer: E (an indication that credit will not be granted)

Explanation

A pro-forma invoice asks for payment before the goods are sent, i.e. no credit.