WAEC Commerce 2014 past questions and answers

A price quotation which includes all the expenses involved in loading the goods into a ship is

1. A.Free on Board (FOB).
2. B.Free Alongside Ship (FAS).
3. C.Cost, Insurance, Freight (C.I.F.).
4. D.ex-ship.

Shares, bonds, stocks and debentures traded on the stock exchange are collectively called

1. A.collaterals.
2. B.commodities.
3. C.resources.
4. D.securities.

Which of the following is engaged in commercial occupation?

1. A.A brick layer
2. B.An engineer
3. C.An insurance broker
4. D.A barber.

"Net 3 months" on an invoice means the buyer will

1. A.pay interest after 3 months.
2. B.get discount if he pays within 3 months.
3. C.pay full invoice amount after 3 months.
4. D.have discount if he pays after 3 months.

The ratio between a country's exports and her imports prices is the

1. A.balance of trade.
2. B.balance of payments.
3. C.terms of trade.
4. D.exchange rate.

The charge paid to a ship owner for the unused part of a ship is known as

1. A.penalty.
2. B.dock dues.
3. C.dead freight.
4. D.demurrage.

Fidelity guarantee insurance will only cover

1. A.cashier's fraud.
2. B.daylight robbery.
3. C.loss of profit
4. D.unpaid loan.

In the absence of the bill of lading, which of the following is used to clear the goods?

1. A.Bill of sight
2. B.Dock warrant
3. C.Certificate of origin
4. D.Mate's receipt.

A system of sales, where goods are sold to the highest bidder is known as

1. A.credit sale.
2. B.hire purchase.
3. C.clearance sale.
4. D.auction sale.

The term "fiduciary issue" means

1. A.money issued without gold backing.
2. B.money issued with gold backing.
3. C.money issued as currency note.
4. D.gold reserve.

An insurance principle which prevents an insured from making profit when compensated is known as

1. A.proximate cause.
2. B.indemnity.
3. C.insurable interest.
4. D.utmost good faith.

A retail outlet with many branches all dealing in similar line of goods is described as a

1. A.department store.
2. B.supermarket.
3. C.chain store.
4. D.hypermarket.

The person who gave his building as a security for loan is known as a

1. A.trustee.
2. B.mortgagee.
3. C.mortgagor.
4. D.guarantor.

A firm that specializes in packing and shipping of goods is known as a

1. A.forwarding agent.
2. B.general agent.
3. C.del credere agent.
4. D.cargo handling company.

Which of the following is a function of marketing department in a firm?

1. A.Add value to goods and services.
2. B.Protect those who engage in business transactions.
3. C.Initiate general policies in the organization.
4. D.Handle all staff matters in the business.

An individual or company that engages in the transportation of any type of goods for a fee is called a

1. A.common carrier.
2. B.hawker.
3. C.porter.
4. D.clearing agent.

Debentures which are secured by the fixed assets of a company are called

1. A.Mortgaged Debentures.
2. B.Naked Debentures.
3. C.Redeemable Debentures.
4. D.Irredeemable Debentures.

The central bank sometimes calls for special deposits from the commercial banks in order to

1. A.reduce bank lending.
2. B.increase bank lending.
3. C.withdraw defaced currencies.
4. D.issue new notes and coins.

A principal member of the stock exchange who buys and sells securities on his own is a

1. A.jobber.
2. B.promoter.
3. C.broker.
4. D.speculator.

Consumer protection places an obligation on producers to ensure that their products

1. A.are wholesome and safe.
2. B.are cheap.
3. C.do not evade customs examination.
4. D.are branded.

The target for all marketing activities is the

1. A.consumer.
2. B.middleman.
3. C.producer.
4. D.distributor.

Small-scale retailers continue to exist in spite of the dominance of large firms because they

1. A.render personal service.
2. B.employ few salesmen.
3. C.can raise large capital from relatives.
4. D.deal in specific goods.

Buildings and machinery purchased for use in business are examples of

1. A.current assets.
2. B.fixed assets.
3. C.capital employed.
4. D.paid up capital.

Use the following information: Olumide bought shares in a company with the following information: Authorized capital ₦500,000; Issued capital ₦450,000; Nominal value ₦1.00; Market price ₦1.20.
If the shares are offered to him at ₦1.15, the share is sold at

1. A.par value.
2. B.a discount
3. C.face value.
4. D.a premium.

Use the following information: Olumide bought shares in a company with the following information: Authorized capital ₦500,000; Issued capital ₦450,000; Nominal value ₦1.00; Market price ₦1.20.
Calculate the number of unissued shares of the company.

1. A.950,000 shares.
2. B.500,000 shares.
3. C.450,000 shares.
4. D.50,000 shares.

The throwing of goods over board to prevent a ship from sinking is known as

1. A.floatsam.
2. B.abandonment.
3. C.jettison.
4. D.particular average.

In insurance, risks that have no statistics for their calculations are

1. A.insurable risks.
2. B.certain risks.
3. C.un-insurable risks.
4. D.uncertain risks.

The practice of selling goods in foreign countries at lower prices than obtainable in the exporting country is known as

1. A.entrepot trade.
2. B.dumping.
3. C.hedging.
4. D.counter trade.

Buying on impulse is encouraged by

1. A.co-operative shops.
2. B.hawkers.
3. C.supermarkets.
4. D.mail order firms.

A fixed deposit account is beneficial to its holders because

1. A.cheques can be issued to settle huge debts.
2. B.customers can become shareholders of the bank.
3. C.it attracts higher interest rate.
4. D.it allows customers to overdraw their accounts.

An amount paid by a bull who wishes to defer the purchase of shares to the next accounting period is

1. A.brokerage.
2. B.backwardation.
3. C.contango.
4. D.commission.

Foreign trade is concerned with

1. A.exchange of goods and services among companies
2. B.buying and selling of imported goods.
3. C.exchange of goods and services among citizens.
4. D.buying and selling of goods and services among countries.

The distribution of goods creates

1. A.time utility.
2. B.place utility.
3. C.form utility.
4. D.possession utility.

The documents issued by the Registrar of companies which allows a public company to commence business is called

1. A.trading certificate.
2. B.prospectus.
3. C.certificate of incorporation.
4. D.memorandum of association.

A cheque bearing a date showing that it was issued more than six months ago is termed a

1. A.blank cheque.
2. B.bearer cheque.
3. C.stale cheque.
4. D.order cheque.

A system of buying products from a machine is known as

1. A.impulse buying.
2. B.branding.
3. C.automatic vending.
4. D.loss leader.

Carpentry is an activity classified under

1. A.extractive occupation.
2. B.tertiary occupation.
3. C.commercial occupation.
4. D.constructive occupation.

A system of buying goods by an agent where the supplier is determined by the principal is

1. A.tied shop.
2. B.closed indent.
3. C.open indent.
4. D.ring trading.

One of the functions of a central bank is to

1. A.perform supervisory role over all the banks in the country.
2. B.provide the means of payment to individuals.
3. C.ensure the smooth transfer of shares.
4. D.accept private deposits.

The issue of Certificate of Incorporation to a company means that it has

1. A.started production.
2. B.legally come into being.
3. C.appointed a board of directors.
4. D.merged with another company.

The part of authorized capital of a company sold to shareholders is

1. A.paid-up capital.
2. B.called-up capital.
3. C.issued capital.
4. D.nominal capital.

A person who contributes money to a partnership business and is also involved in its general supervision is called

1. A.an active partner.
2. B.a limited partner.
3. C.a dormant partner.
4. D.a nominal partner.

A business obtains part of its short-term capital from

1. A.bonds.
2. B.debentures.
3. C.trade credit.
4. D.ordinary shares.

A postal service that allows a company's customers to reply to its advertisements at the expense of the company is

1. A.recorded delivery service.
2. B.post restante.
3. C.express delivery service.
4. D.business reply service.

When a ship overstays the allowed number of days at the port, it is made to pay

1. A.interest.
2. B.tariff.
3. C.demurrage.
4. D.commission.

The place where bankers meet daily to exchange cheques drawn on each other is known as

1. A.capital market.
2. B.money market.
3. C.clearing house.
4. D.discount house.

An advertising campaign designed to sell one's own products at the expense of other brands is

1. A.competitive.
2. B.persuasive.
3. C.direct.
4. D.informative.

Commerce 2 (essay)
Compare a public limited company with partnership under the following headings:
(a) Formation;
(b) Ownership and Control;
(c) Source of Capital;
(d) Liability;
(e) Dissolution.

Commerce 2 (essay)
(a) Define a multiple shop.
(b) State three features of a multiple shop.
(c) Explain three advantages and three disadvantages of a multiple shop.

Commerce 2 (essay)
(a) State five problems of barter system of trading.
(b) Explain five ways in which the introduction of money has solved the problems stated in 3(a) above.

Commerce 2 (essay)
Explain each of the following insurance concepts:
(a) Non-indemnity insurance;
(b) Group insurance;
(c) Re-insurance;
(d) Under insurance;
(e) Consequential loss insurance.

Commerce 2 (essay)
(a) What is packaging?
(b) State three disadvantages of packaging.
(c) State five reasons for the packaging of products by manufacturers.

Commerce 2 (essay)
(a) Define a contract of sale.
(b) Outline six items that must be contained in a contract of sale.

Commerce 2 (essay)
(a) What is a stock exchange market?
(b) Explain six functions of the stock exchange market.

Commerce 2 (essay)
(a) Explain current assets giving two examples.
(b) State two uses of working capital.
(c) The state of affairs of Zig Stores as at 31st December, 2009 shows the following (₦):
Furniture and fittings – 30,000
Motor Van – 164,000
Stocks – 76,000
Debtors – 50,000
Creditors – 60,000
Cash in hand – 20,000
Bank overdraft – 10,000
You are required to calculate Zig Stores:
(i) Current liabilities;
(ii) Current assets;
(iii) Working capital.
Note: Show all workings