GRADE 12 MODEL QUESTION PAPER 2020-21

32 Calculate values of opening and closing inventories from the following 6 information: Revenue from operations Rs.6,00,000; Gross profit ratio- 25 % Inventory Turnover ratio -5times; Closing inventory is Rs.12,000 more than the opening inventory (b)Rate of gross profit on Revenue from operation of a company is 25%. Its Gross profit is Rs.5,00,000; its Shareholders fund are Rs.25,00,000; Long term Loan Rs.8,00,000 and Non-Current Assets were Rs23,00,000. Compute Working Capital Turnover Ratio of the company. Part – B (Computerised Accounting) 23 List any two attributes of information to be stored in Payroll data base. 1 24 Which of the following is not an advantage of computerised accounting 1 system? a) Efficient record keeping b) Ensures effective control over the system. c) Generation of reports and information in fixed format d) Economy in the processing of accounting data. 25 Differentiate between Generic software and Specific Software on basis of cost 1 of installation and maintenance 26 The data is classified for creating groups of accounts in the heads of: 1 (A) Assets, Liabilities and Capital (B) Assets, Owners’ equity, Revenue and Expenses (C) Assets, Capital, Liabilities, Revenue and Expenses (D) Capital, Revenue and Expenses 27 A1: E2 in Excel refers to: 1 (A) Column on Excel sheet (B) Row on Excel sheet (C) Column between start and end points of Excel sheet (D) Alphabets between A to E on Excel sheet.

28 Name the data element in the accounting transaction. 1 29 What is the activity sequence of the basic information processing mode 1 30 Explain adjusting entries. 3 OR 4 Explain ‘Null Values’ and ‘Complex Attributes’. 31 Name and explain the function which returns the future value of an 6 investment which has constant payment and interest. OR Explain ‘Sequential’ and ‘Mnemonic’ codes. 32 Identify the error that appears when there are invalid numeric values in a formula or function. How can this error be rectified? Explain.

Qn NO. ​ACCOUNTANCY (055) Marks MARKING SCHEME 1 Part- A (Accounting for Not for Profit organizations, Partnership firms and Companies) 1 a) cash principle 2 b) Interest on loan & advances 1 3 1:1 1 4 Reconstitution would result into reforming of Partnership firm with 1 certain changes and Dissolution would result into its closure of Business. 1 5 (c) Unsubscribed capital 1 6 c) Rs.97,500 1 7 5000 Cr 1 8 (b) Distributed among partners in old ratio 1 9 False. It records receipts and payments of revenue as well as capital nature. (1/2 mark for answer and ½ mark for reason) 10 His share of loss transferred to his account. 1 11 a) A partnership business may include trade, vocation and profession 1 but not Joint ownership. 12 a) Self-generated goodwill is not accounted as an asset OR goodwill 1 should not be raised in the books of accounts. 13 (b) 10,000 1

14 3 P​ ARTICULARS Amount Amount paid for sports materials 19,000 Add: i) Creditors at the end of the year 2,600 ii) Opening stock 7,500 29,100 Less: i) Closing stock (6,400) ii) Creditors at the beginning of the year (2,000) Sports material consumed ​20,700 OR Stock of stationery on 01.04.2019 ----------------- ₹ 8,000 Stationery purchased during 2019-20------------- ₹ 47,000 Less: Stock of stationery on 31.03.2020 --------- ₹​ (6,000) Stationery consumed during 2019-20 -------- ​₹ 49,000 Amount to be debited to I & E a/c ₹ ​49,000 15 4 Date Particulars L.F Dr Cr 6000 6000 Realization A/c Dr 27000 To K’s Capital A/c 27000 3000 Realization A/c Dr 3000 15000 To Bank A/c 5000 K’s Capital Account Dr 5000 5000 To Realization A/c R’s Capital A/c Dr K’s Capital A/c Dr S’s Capital A/c Dr To Profit and Loss A/c Date Particulars OR Cr. ₹ L.F. Dr. ₹

i) Ravi’s Capital a/c Dr. 19,200 To Realisation a/c 19,200 (40% of the total stock taken over by Ravi at 20% discount) ii) No entry iii) Cash a/c 22,500 To Realisation a/c 22,500 (stock sold for cash) iv) Realisation a/c 45,000 To cash a/c 45,000 (Creditors paid in cash at a discount of 10%) 16 4 Date Particulars L.F. Dr. Cr. 2019 Z’s Capital a/c Dr 18,000 18,000 April To X’s Capital a/c (Being the adjustment entry) Working notes: 1. Net effect of the balances of accumulated profits and losses General reserve ₹ 90,000 Workmen compensation reserve ₹ 10,000 Advertisement suspense a/c ​ ₹ (40,000) Net amount to be adjusted ​ ₹ 60,000 2. Calculation of sacrifice / gain due to change in profit-sharing ratio X’s Sacrifice / Gain = 5/10 – 2/10 = 3/10 (sacrifice) Y’s Sacrifice / Gain = 3/10 – 3/10 = 0 (no change) Z’s Sacrifice / Gain = 2/10 – 5/10 = (3/10) (gain) In this case Z has gained 3/10 in share whereas, X has sacrificed 3/10​th​ share. Thus, Z will compensate x for his gained share

i.e., ₹ 60,000 X 3/10 = ₹ 18,000 17 Balance Sheet of Tanmay Ltd. 4 As at ....................(As per revised schedule VI) Particulars Not Amoun Amount e No. t (Rs.) (Rs.) Current Previous year year EQUITY & LIABILITIES 1 5,79,60 --------------- 1 Shareholder’s fund : 0- a) Share Capital Notes to Accounts 1. Share Capital Authorised Capital:​ 2,00,000 equity 20,00,000 1 shares of Rs.10 each 10,00,000 1 Issued Capital​ 1,00,000 equity shares 5,78,400 of Rs.10 each 1,200 5,79,600 Subscribed Capital Subscribed but not fully paid 96,400 shares of Rs.10 each, Rs.6 called-up Add: Forfeited shares A/c 1 18 Dona’s share of profit = 2,40,000 x9/100x5/10x6/12 =5,400 4 (Each entry carries one mark)

19 6 Date Particulars L. F Debit Credit Bank A/c……………….Dr 50000 Loss on issue of Debenture 5000 A/C…...Dr 50000 To 9% Debenture A/C 5000 To Premium on Redemption A/C Bank A/C………………Dr 80000 To Bank Loan A/C 80000 (Being Loan raised from bank) Debenture SuspensA/C…………..Dr 100000 To 9% Debenture A/C 100000 (debenture issues as collateral Securities) Profit & Loss A/C………………Dr 5000 To Loss on issue of 5000 Debenture A/C (Being Loss on issue charged from Profit & loss A/C) Extract of Balance Sheet As on ……………………… Particulars Note No Amount A. Equities & Liabilities 150000 50000 a. Equities 1​ 00000 80000 b. Non-Current Liabilities i. 9% Debenture (-) Debenture Suspense ii. Bank Loan

B. Assets 13000 a. Non-Current Assets b. Current Assets 6 i. Bank 8 20 Surplus = 24750 Opening capital fund = 58500 Total of balance sheet =89500 21

OR Loss of revaluation Rs. 42,000 (3​ marks) BAL of capital account Raman 161600 Rohit 102400 ​(3 marks) Saloni 132000 Balance sheet Total 569500 ​(2 marks) 22 8 Date Particulars L.F. Dr. (₹) Cr. (₹) i Bank a/c 8,00,000 Dr. 8,00.000 To Equity share application a/c (Money received on application) ii Equity share application a/c 8,00,000 Dr. 8,00,000 To Equity share capital a/c

(Application money transferred to share capital a/c) iii Equity share allotment a/c 10,00,000 Dr. 4,00,000 To Equity share capital a/c 6,00,000 To Securities premium reserve a/c (allotment, including premium due) iv Banka/c 10,00,000 10,00,000 Dr. To Equity share allotment a/c (Allotment money received including premium) v Equity share first call a/c Dr. 4,00,000 To Equity share capital a/c 4,00,000 (money due on first call) vi Bank a/c 4,00,000 Dr. 4,00,000 To Equity share first call a/c (money received on first call) vii Equity share second and final call a/c 4,00,000 Dr. 4,00,000 To Equity share capital a/c (Money due on second and final call) viii Bank a/c Dr. 4,00,000 To Equity share second and final call 4,00,000 a/c (Money received on second and final call) ix Share issue expenses a/c Dr. 75,000 . 75,000 To Bank a/c (Expenses incurred on issue of shares) x Securities premium reserve a/c 75,000 . 75,000 To Share issue expenses a/c

(Share issue expenses written off against securities premium reserve a/c) OR Date Particulars Dr. (₹) Cr. (₹) L.F 8,00,000 8,00,000 . 4,00,000 i Bank a/c 8,00,000 6,00,000 10,00,000 Dr. To Equity share application a/c 4,00,000 (Money received on application) ii Equity share application a/c 8,00,000 Dr. To Equity share capital a/c (Application money transferred to share capital a/c) iii Equity share allotment a/c 10,00,000 Dr. To Equity share capital a/c To Securities premium reserve a/c (allotment, including premium due) iv Bank a/c 10,00,000 Dr. To Equity share allotment a/c (Allotment money received including premium) v Equity share first call a/c 4,00,000 Dr. To Equity share capital a/c (money due on first call)

vi Bank a/c 4,00,000 Dr. 4,00,000 To Equity share first call a/c (money received on first call) vii Equity share second and final call a/c 4,00,000 Dr. 4,00,000 To Equity share capital a/c (Money due on second and final call) viii Bank a/c Dr. 4,00,000 . 4,00,000 To Equity share second and fina call a/c (Money received on second and final call) ix Share issue expenses a/c Dr. 75,000 . 75,000 To Bank a/c (Expenses incurred on issue of shares) x Securities premium reserve a/c 75,000 . 75,000 To Share issue expenses a/c (Share issue expenses written off against securities premium reserve a/c) OR Date Particulars Dr. (₹) Cr. L.F. (₹) Bank a/c Dr. 1,00,000 I To 10% debentures application a/c 1,00,000 (Application money received on 10,000 debentures @ ₹10 per debenture) ii 10% debentures application a/c Dr. 1,00,000 To 10% debentures a/c 1,00,000 (application money transferred)

10% Debentures allotment a/c Dr. 2,00,000 iii To 10 % debentures a/c 2,00,000 (Allotment due) Bank a/c Dr. 2,46,000 iv To 10% Debentures allotment a/c 1,90,000 To Calls in advance a/c 56,000 (allotment money received on 9,500 debentures @ ₹ 20 per debenture; plus call received in advance on 800 debentures @ ₹ 70 per debenture) 10% Debentures first call a/c Dr. 3,00,000 v To Debentures a/c 3,00,000 (First call due on 10,000 debentures @ ₹ 30 each) 2,76,000 vi Bank a/c Dr. Calls in advance a/c Dr. 24,000 To 10% Debenture first call a/c 3,00,000 (first call money received after adjusting the advance of first call @ ₹ 30 per debenture on 800 debentures of Kala) 10,000 vii Bank a/c To 10% Debentures allotment a/c 10,000 (receipt of arrears of allotment in respect of 500 debentures) viii 10% debentures second and final call 4,00,000 . a/c Dr. 4,00,000 To 10% Debentures a/c (Second and final call due on 10,000 debentures @ ₹ 40 per debenture)

ix Bank a/c Dr. 3,68,000 Calls in advance a/c Dr. 32,000 To 10% debentures second and final 4,00,000 call a/c (Second call money received after adjusting the advance of second call @ ₹ 40 per debenture on 800 debentures of Kala) Part – B (Analysis of Financial statements) 23 a) Solvency Ratio 1 24 b) Common size 1 25 Proprietary ratio assesses the solvency of the concern. It shows the extent 1 to which fixed assets are financed by owner's fund. 1 26 d.Total assets 1 1 27 Financing activities are the activities that result in change in capital or borrowings of the enterprise. 28 Because they are not held for conversion into cash. 29 b) Profitability ratio i) Earning capacity ii) Short term credibility c) Liquidity ratio i)- b ii) c 30 a) Return on investment = Profit before interest and tax / Capital employed 3 X 100 Profit before tax = 1,00,000 X 100/5 = ₹ 2,00,000 Add: Int. on long term debts = ​₹ 40,000

Profit before interest and tax = ₹​ 2,40,000 Capital employed = total assets – current liabilities =₹ 10,00,000 – ₹ 2,00,000 = ₹ 8,00,000 Therefore, return on investment = ​2,40,000 / 8,00,000 X 100 = 30% b) Working capital turnover ratio = Revenue from operations / Working capital Gross profit = ₹ 5,00,000 So, Revenue from operations = ₹ 5,00,000 X 100/25 = ₹ 20,00,000 Working capital = Shareholder’s funds + Non-current liabilities – noncurrent assets = ₹ 25,00,000 + ₹ 8,00,000 – ₹ 23,00,000 = ₹ 10,00,000 Working capital turnover ratio = ₹ 20,00,000/10,00,000 = 2​ times OR Current liabilities= Rs.80,000 Quick Assets Rs.1,20,000 Quick ratio= 1,20,000/80,000 = 1​ .5:1

31 Profit after tax (31-03-2019) – 6,00,000 4 (31-03-2020) – 7,80,000 OR In the books of ‘Hari Darshan Ltd.’ common size statement of profit and loss For the year ended 31s​ t​ March 2018 and 31​st​ March 2019 Particulars Absolute Absolute Percentage Percentage amount amount of RFO of RFO 2017 – 18 2018-19 2017-18 % 2017-18 % Revenue from 10,00,000 20,00,000 100 100 operations Add: Other income 50,000 60,000 5 5 Total revenue 10,50,000 20,60,000 105 103 Less: Expenses . .. . Purchase of stock 4,20,000 7,70,000 42 38.5 in trade Change in 80,000 1,20,000 8 6.0 inventories Other expenses 30,000 52,000 3 2.6 Total expenses 5,30,000 9,42,000 53 47.1 Profit before tax 5,20,000 11,18,000 52 55.90 Less: Tax @ 50% 2,60,000 5,59,000 26 27.95 Profit after tax 2,60,000 5,59,000 26 27.95 32 Opening inventory 84,000 closing inventory 96,000 6

Working capital turnover ratio- 2times Part – B (Computerised Accounting) 23 Attributes of information to be stored in Payroll data base: (Any two) 1 (i) Name (ii) ID 1 (iii) Designation 1 (iv) Location 1 (v) Basic Pay 1 1 24 c) Generation of reports and information in fixed format 25 Cost of installation and maintenance is generally low with Generic 1 3 Software and is relatively high with Specific software 26 (C) Assets, Capital, Liabilities, Revenue and Expenses. 27 (c) Column between start and end points of Excel sheet 28 A data element is the smallest named unit of data in the information system. In accounting, a transaction consists of four data elements, such as name of the account, accounting code, date of transaction and amount 29 The activity sequence of the basic information mode is collected data, organize and process it and then communicate the information extracted. 30 The Adjusting entry is recorded to relate the figures to the trading period. Suppose, premises have been sublet on March 31, and three months’ rent, has been received in advance amounting to Rs. 12000. While preparing accounts up to 31st March, one should taken into account only one month’s rent for preparing the profit and loss account (accounting period concept); the rest two month’s rent, already received is for the next year and will be credited to profit and loss account next year. The adjusting entry will be: Rent Account Dr To Advance Rent Account

Rent Received in advance Account is a ‘Liability’ and is shown in the 4 balance sheet. OR Null Values:​ Absence of data item is represented by a special value called null value. There are three situations which may require the use of null value. ·​ ​ When particular attribute does not apply to an entity. ​·​ Value of an attribute is unknown although it exists. ·​ ​ Unknown because it does not exist. Complex Attributes:​ These are composite and multivalued attributes which may be nested (or grouped) to constitute complex ones. The parenthesis { } are used for showing grouping of components of composite attributes. The braces { } are used for showing the multivalued attributes. 31 PMT :- The PMT function calculates the periodic payment for an annuity assuming equal payments and a constant rate of interest. The syntax of PMT function is as follows: = P​ MT (rate, nper, pv, [fv], [type]) where Rate is the interest rate per period, Nper is the number of periods, Pv is the present value or the amount the future payments are worth presently, future value or cash balance that after the last payment is made (a future value of zero when we omit this optional argument) Type is the value 0 for payments made at the end of the period or the value 1 for payments made at the beginning of the period. The PMT function is often used to calculate the payment for mortgage loans that have a fixed rate of interest OR

Sequential codes These are the codes in which code numbers and/or letters are assigned in a consecutive order. These codes are applied primarily to source documents such as cheques, invoices etc. This facilitates document searches. This process enables either identification of missing codes (numbers) relating to a particular document or to trace a relevant document on the basis of the codes. Mnemonic codes These codes consist of alphabets or abbreviations as symbols to codify a piece of information. SJ for sales journal, HQ for Headquarters are examples of mnemonic codes 32 The error is #NUM! Error. The steps to correct it are: 6 1. Optionally, click the cell that displays the error, click the button that appears and then click show calculation steps. 2. Review the following causes and solutions: ● Using an unacceptable argument in the function that requires a numeric argument. ● Make sure that the arguments used in the function are numbers. ● Using a worksheet function that iterates, such as IRR or RATE, and the function cannot find the result. ● Use a different starting value for the worksheet function. Then click the Microsoft button >Excel option and then click the formulas category.

MODEL EXAMINATION 2020 – 21 CLASS – XII SUBJECT – BUSINESS STUDIES TIME: 3 HOURS MM: 80 General instructions: 1 This question paper contains 34 questions. 2. Marks are indicated against each question. 3. Answer should be brief and to the point. 4. Answers to the questions carrying 3 marks may be from 50 to 75 words. 5. Answers to the questions carrying 4 marks may be about 150 words. 6. Answers to the questions carrying 6 marks may be about 200 words. 7. Attempt all parts of the questions together. 1 Grouping of activities on the basis of functions is a part of 1 (a) Decentralised organisation (b) Divisional organisation (c) Functional organisation (d) Centralised organisation 2 The Reserve Bank of India reduces CRR (Cash Reserve Ratio) by 1 0.5% to control recession. This is related to which dimension of Business Environment. (a) Political Environment (b) Economic Environment (c) Social Environment (d) Legal Environment 3 The process by which a manager integrates and synchronises the 1

activities of different department is called (a) Management (b) Controlling (c) Planning (d) Coordination 4 All the forces of Business Environment are_______________ 1 (a) Relativity (b) Inter related (c) Uncertain (d) None of the above 5 Management is a process because 1 (a) It involves series of steps (b) It leads to systematic working (c) It involves one single activity (d) None of the above 6 Introduction of mobile phone have negatively affected the business of 1 watches and cameras \"Which factor of business environment is related with the sentence. (a) Social environment (b)Technological environment (c) Political environment (d)Legal environment 7 Name the method of training in which the trainee learns under the 1 guidance of a master worker. a. Internship Training b. Apprenticeship Programme c. Vestibule Training d. Campus Recruitment 8 Under which philosophy of marketing, efforts are made to bring down 1 the cost of production to the minimum? (a)Production concept (b)Product concept (c)Marketing concept (d)Selling concept 9 ____________ is the step in the planning process where other 1 managerial functions also curve into picture. (a) Evaluating alternative course of actions (b) Selecting an alternative (c) Implementing the plan (d) Following action 10 Controlling function of an organisation is _________________ 1 (a) Forward looking (b) Backward looking

(c) Forward as well as backward looking 1 (d) None of the above 11 In order to get feedback about its recently launched immunity boosting ayurvedic medicine, Adarsh limited conducted an online survey using a questionnaire, to gather customer views and opinions. Identify the marketing function being used by Adarsh Limited: (a) Standardisation (b) Product Designing (c) Customer support service (d) Gathering and analysing market information OR A bottle of hair oil is an example of (a) Primary packaging (b) Secondary packaging (c) Transportation packaging (d) Sales promotion 12 Evenly distribution of authority at every level lead to 1 (a) Delegation (b) Decentralisation (c) Informal Organisation (d) Formal Organisation OR _____________ is a process by which the manager brings order out of chaos, removes conflict among people over work or responsibility sharing and creates an environment suitable for teamwork. (a) Planning (b) Controlling (c) Organising (d) Directing Read the following text and answer question No. 13-16 on the basis

of the same: „UFT Steel Ltd‟. is a large and creditworthy company manufacturing steel for the Indian market. It now wants to cater to the Asian market and decides to invest in new hi-tech machines. Since the investment is large, it requires long-term finance. It decides to raise funds by issuing equity shares. The issue of equity shares involves huge floatation cost. To meet the expenses of floatation cost the company decides to tap the money-market. 13 Name and explain the money-market instrument the company can 1 use for the above purpose. (a) Call money (b) Treasury bill (c) Commercial paper (d) Certificate of deposit 14 What is the duration for which the company can get funds through 1 this instrument? (a) 91 days to one year (b) 15 days to one year (c) One day to 15 days (d) One year 15 State any other purpose for which this instrument can be used. 1 (a) It can be used for seasonal capital need (b) It can used for working capital need (c) Both a and b (d) None of the above. 16 Identify the market UFT Steel Ltd. will look for raising fund. 1 (a) Primary market (b) Secondary market

(c) Both a and b (d) None of the above Read the following text and answer question No.17-20 on the basis of the same: Aditya Crackers Ltd., a fire-cracker manufacturing company located in Hyderabad, launched some new products on the eve of Diwali in the market which attracted many buyers due to its low prices. The demand increased and to meet this increased demand, the company employed people from the nearby villages where there was a lot of unemployment. Very soon the products were a hit in the market that initiated the company official to get it registered with a special name “Charminar”. Their competitors starting to imitate their products but failed to replicate the success of company. Aditya Ltd. started to send the products to other states also. They appointed several Distributors in big cities and offered attractive discounts to them. Company also used an advertising agency to aware the people that the products were least harming the environment as compared to their competitors. The Company was very much keen to cater the interest of society by focusing on using less toxic material while production and thus all the preventive measures were taken while production of fire crackers to secure the environment. 17 …...Very soon the products were a hit in the market that initiated the 1 company official to get it registered with a special name “ Charminar” With reference to the given text “Charminar” is a ____________ to protect the product from the competitors‟ imitation. (a) Brand Value (b) Trade mark (c) Brand mark (d) None of these. 18 Aditya Crackers Ltd., a fire-cracker manufacturing company located in 1 Hyderabad, launched some new products on the eve of Diwali in the market which attracted many buyers due to its low prices……... With reference to the text above, which element of marketing mix has

been discussed here: (a) Price (b) Place (c) Both (a) and (b) (d) Neither (a) nor (b) 19 The Company was very much keen to………………………. 1 In this statement, company tried to follow one marketing philosophy. Identify the same: (a) Marketing concept (b) Selling concept (c) Societal Marketing concept (d) Production concept 20 Company also used an advertising agency to aware the people that 1 the products were least harming the environment as compared to their competitors……………. With reference to the text above, which element of marketing mix has been used here: (a) Price (b) Product (c) Place (d) Promotion 21 Arnav was working in „Axe Ltd‟, a company manufacturing air 3 purifiers. He found that the profits had started declining from the last six months. Profit has an implication for the survival of the firm, so he analysed the business environment to find out the reasons for this decline. (a) Identify the level of management at which Arnav was working. (b) State two other functions being performed by Arnav 22 What do you understand by labelling? State any two functions of 3 labelling in the marketing of the product 23 Romans Ltd. is engaged in manufacturing high end luxury pens. The 3 target production is 700 units daily. The company had been successfully attaining this target until three months ago. Over the last few months, it has been observed that daily productions vary between 600-650 units. (a) Discuss the steps involved in the process of the function discussed above. OR

State any three points of importance of controlling. 24 State any three merits of internal sources of recruitment. 3 OR State any three limitations of external sources of recruitment. 25 Nishant, the director of a garment company, is planning to 4 manufacture bags for the utilisation of waste material from one of his garment‟s unit. He has decided that his manufacturing unit will set-up in a rural area of Odisha where people have very few job opportunities and labour is available at very low rates. He also thought of giving equal opportunities to men and women. For this, he wanted four different heads for sales, accounts, purchase and production. He gave an advertisement and short listed ten candidates per post after conducting different selection tests. Identify and state the next three steps for choosing the best candidate out of the short-listed candidates. 26 Tijo was supervisor at a „Annapurna Aata‟ factory. The factory was 4 producing 200 quintals of Aata every day. His job was to make sure 4 that the work went on smoothly and there was no interruption in production. He was good leader who would give orders only after consulting his subordinates and work out the policies with the acceptance of the group. Identify and describe the leadership style being adopted by Tijo. 27 Sahad was working in enterprise on daily wages basis. It was difficult for him to fulfill the basic needs of his family. His daughter fell ill. He had no money for his daughter‟s treatment. To meet the expenses of her treatment, he participated in a cycle race and won the prize money. The cycle company offered him a permanent pensionable job which he happily accepted. (a) Identify the needs of Sahad that are satisfied by offer of cycle company. (b) (b) Also, explain two other needs of Sahad followed by above

that are still to be satisfied. OR Prem is working in a multinational company in Noida. He was running a temperature for the last many days. When his blood was tested, he was found to be positive for malaria. He was admitted in a hospital and a blood transfusion was advised by the doctors as his condition was very serious. One of his colleagues sent a text message to his superior, Mr. B. Chatterjee. Mr. B. Chatterjee immediately sent a text message to the employees of the organisation requesting them to donate blood for Prem. When the General Manager came to know about it, he ordered for fumigation in the company premises and cleaning the surroundings. 1. From the above paragraph, quote lines that indicate formal and informal communication. 2. State any two features of informal communication 28 Distinguish between delegation and decentralization (any four basis). 4 OR Explain any four points of importance of delegation of authority. 29 Explain any four factors that can affect the fixed capital requirement 4 of a company. OR Explain any four factors that can affect the dividend decision of a company. 30 Explain any two rights of consumers provided by Consumer Protection 4 Act, 1986. 31 What is meant by capital structure? Explain any five factors which 6 affect the choice of capital structure of a company. 32 „Failing to plan is planning to fail.‟ In the light of the statement 6 explain any four importance of planning as a function of management.

OR „Rapid Ltd.‟ is a well-known automobile manufacturing company in India. The company plans to increase the sale of its sedan cars by 20% in the next quarter. In order to achieve the desired target, the marketing team of the company considers the impact of policy of the government towards diesel vehicles and the level of competition in this segment of cars. They explore the various available options like offering more discounts to dealers and customers, providing more customer friendly finance options, lucky draws on test drive, increasing advertising, offering more of free accessories on the purchase of the car, etc. A thorough analysis of the various available options is done keeping in view the relative viability of each option. The company decides to pursue the option of offering more discounts to dealers and customers in order to boost the sale of sedan cars. In order to implement the plan, they determine the various discount packages and communicate the same to their product dealers. To make the prospective consumers aware about the new available benefits, advertisements are made through various sources of print and electronic media. The market analysts of the company keep a close watch on the revenue from the sedan cars to study the effect of new initiatives by the company to promote its sales. In context of the above case: 1. Name the function of management described in the above paragraph. Identify and explain the various steps involved in process the function of management as identified in part (a) by quoting lines from the paragraph. 33 Kushal Ltd. is a leading automobile company in which the various 6 department are setting up their own objective without paying any interest to the organizational objectives. I. Which aspects of management of company is lacking? What will be impact on the organization? II. Identify the principle of management which has been overlooked

by the organization. III. State any two value which is neglected by the people of organization. 34 Various tools of communication are used by the marketers to promote 6 their products. (a) Why do companies use all tools at the same time? (b) Name and explain the most commonly used non-personal tool of promotion which is paid for by the marketer. (c) Which tool of promotion will primarily be used for the following? (i) To promote or protect a company‟s image or its individual products. (ii) An existing product meant for mass usage by literate people. (iii) To introduce a new product to a particular class of people through door to-door visits. (iii) To attract attention of the people by using incentives OR Dayaram‟ is a famous chain selling a large variety of products in the Indian market. Their products include chips, biscuits, sweets and squashes. It charges a comparatively higher price than its competitors as it sells quality products. Besides, it offers regular discounts to its customers and easy credit terms to its retailers. It has five of its own retail shops. It also sells its products through various grocery stores so that the products are made available to customers at the right place, in the right quantity and at the right time. It regularly uses different communication tools to increase its sales. The above paragraph describes the combination of variables used by Dayaram to prepare its market offering. Identify and explain the variables.

MARKING SCHEME Marks BUSINESS STUDIES 2020-21 1 Question 1 No. 1 1 Functional organisation 1 2 Economic environment 1 3 Coordination 1 4 Inter related 1 5 It involves series of steps 1 6 (b)Technological environment 1 7 b. Apprenticeship Programme 1 8 (a) Production concept 1 9 (c) Implementing the plan 10 Forward as well as backward looking 1 11 (d) Gathering and analysing market information OR 1 Primary packaging 1 12 Decentralisation OR 1 Organising 1 13 (a) Commercial paper 14 (a) 15 days to one year 15 (a) Both a and b 16 (a) Primary market

17 (b) Trade mark 1 18 (a) Price 1 19 (c) Societal Marketing concept 1 20 (d) Promotion 1 21 (a) Top level 3 3 Any two functions performed by top level management 22 Meaning (1mark) 3 Any two functions (1 mark each) 3 ● Describe the product 4 ● Identify the product ● Help in grading ● Promote sales ● Provide information 23 1. Setting Performance Standards 2. Measurement of actual performance 3. Comparing actual performance with standards 4. Analysing deviations OR 1. Accomplishing organisational goals 2. Making efficient use of resources 3. Ensuring order and discipline 4. Improves employee motivation 5. Judging accuracy of standards 6. Facilitates coordination in action (any three points) 24 1 mark for each merit of internal sources of recruitment OR 1 mark for each limitation of external sources of recruitment 25 1. The next three steps to be followed by Nishant in the selection process after giving an advertising and short listing ten candidates per post after

conducting different selection tests are as follows: Employment Interview: It is a face-to-face interaction between the interviewers and prospective candidate. It involves a formal, in- depth conversation that is conducted to evaluate the applicant‟s suitability for the job. Reference and Background Checks: At the time of filling up of the job application form,the prospective candidates are required to provide names, addresses, and telephone numbers of references for the purpose of verifying information and gaining additional information about him/her. Selection Decision: The final decision about the selection is made from among the candidates who pass the tests and interview. 26 Democratic style of leadership 4 27 1. Physiological and safety/security needs. 4 2. Other needs a. Affiliation/ Belongingness needs b. Esteem needs OR Informal communication: “One of his colleagues sent a text message to his superior, Mr. B. Chatterjee. Mr. B. Chatterjee immediately sent a text message to the employees of the organisation requesting them to donate blood for Sahad.” Formal communication: “When the general manger came to know about it, he ordered for fumigation in the company premises and cleaning surroundings.” The features of informal communication are as follows:

● The grapevine/ informal communication spreads very fast and sometimes gets distorted. ● It is very difficult to detect the source of such communication. 28 1 mark for each correct difference between delegation 4 and decentralization OR 1 mark for each correct importance (4x1) 29 Factors affecting fixed capital requirements: 4 1. Nature/type of business 2. Scale of operations 3.Choice of techniques 4. Technology upgradation 5. Growth prospects 6. Diversification 7. Financing alternatives 8. Level of collaboration OR Factors affecting dividend decisions: 1. If the earnings of the company are high, dividends are paid at a higher rate. If the earnings of a company are stable, it is likely to pay higher dividends. 2. A company is more likely to maintain a stable dividend rate over a period of time, unless there is a significant change in its earnings. 3. A company planning to pursue a growth opportunity is likely to pay lower dividends. 4. The dividends are paid in cash, therefore if the cash flow of the company is good, it is likely to pay higher dividends. 5. If the shareholders prefer regular income in form of dividends, the company is likely to maintain a dividend

pay-out rate. 6. If the tax rate is high, the company is likely to pay less dividend. 7. If a company wants positive reactions at stock market, It Is likely to pay higher dividends. 8. A large company can access funds easily from capital market as per its requirements, therefore, it is likely to retain lesser profits and is likely to pay higher dividends. 9. The legal constraint should be considered at the time of dividend payment by a company. 10. The contractual constraints may also affect the dividend payment by a company. 30 Any two rights of consumers 2 marks each 4 31 Meaning of capital structure (1 mark) 6 1 mark for each correct factor (5x1) 6 32 Importance of planning: 1. Planning provides direction as it acts as a guide for deciding what course of action should be taken to attain the organisational goals. 2. Planning reduces the risk of uncertainty arising due to the dynamic nature of business environment as it enables a manager to anticipate and meet changes effectively. 3. Planning reduces overlapping & wasteful activities as it serves as the basis for coordinating the activities and efforts of different divisions and individuals. 4. Planning promotes innovation as it encourages new ideas that can take shape of concrete plans. 5. Planning facilitates decision making as it enables a manager to choose the best alternative course „of action among the various available alternatives in light of present and future conditions. 6. Planning establishes standards for

controlling. Planning provides standards against which the actual performance is measured and timely corrective actions the taken. (Any Four) OR 1. Planning is the function of management which is being described in the above paragraph. 2. The various steps involved in the planning process are explained below: ● Setting objectives: The planning process is initiated by setting the objectives in clear, specific and measurable terms. The objectives may be set for the organization as a whole and for each department or unit within the organization. “The company plans to increase the sale of its sedan cars by 20% in next quarter.” ● Developing Premises: Planning process is carried out keeping in view the assumptions related to the future, which is uncertain. These assumptions are called premises and may relate to government policy, interest rate, inflation, etc. Accurate forecasts are therefore essential for successful planning. “In order to achieve the desired target the marketing team of the company considers the impact of policy of the government towards diesel vehicles and level of competition in this segment of cars.” . ● Identifying alternative courses of action: The next step in the planning process involves identification of the various ways in which the goals can be achieved. “They explore the various available options

like offering more discount to dealers and customers, providing more customer friendly finance options, lucky draws on test drives, increasing advertising, offering more of free accessories on the purchase of the car, etc.” ● Evaluating alternative courses: In order to select the best option, the relative positive and negative aspects of each alternative should be evaluated in the light of their feasibility and consequences. “A thorough analysis of the various available options is done keeping in view the relative viability of each option.” ● Selecting an alternative: The best plan is adopted to achieve the desired goals. Sometimes, a combination of plans may be selected instead of one best course of action. “The company decides to pursue the option of offering more discount to dealers and customers in order to boost the sale of sedan cars.” ● Implement the plan: This step is concerned with putting plans into action. “In order to implement the plan, they determine the various discount packages and communicate the same to their product dealers. To make the prospective consumers aware about the new available benefits, advertisements are made through various sources of print and electronic media.” ● Follow up action: Monitoring of plans is equally important to ensure that objectives are achieved efficiently and effectively. “The market analysts of the company keep a

close watch on the revenue from the sedan 6 cars to study the effect of new initiatives by 6 the company to promote its sales.” 33 I. The company is lacking „coordination‟. Its different department like production, marketing, etc. do not coordinate this wok in absence of coordination; these will be overlapping and chaos instead of harmony and integration of activities. The company will fail to achieve its objectives. II. Subordinate of individual interest to general interest. Values -Mutual cooperation, unity of action, optimum utilization of resources. 34 (a) The companies use all tools at the same time because of the nature of market, nature of product, promotion budget and objectives of promotion being different at different times. (b) The most commonly used non-personal tool of promotion which is paid for by the marketer is advertising. It is a paid and non-personal form having an identified sponsor to promote an idea. (c) The tools of promotion used are: 1. Public relations 2. Advertisements 3. Personal selling 4. Sales promotion OR The combination of variables used by Haryaramto prepare its market offerings are described below: ● Product: “Their products include chips, biscuits, sweets and squashes.” A product is anything of value i.e. a product or service offered to a market to satisfy its needs or

wants. A product includes physical product, after sale service, handling grievances etc. Every marketer needs to constantly review and revise its products in order to enhance customer‟s satisfaction and have a competitive edge. ● Price: “It charges a comparatively higher price than its competitors.” Price is the monetary value paid in consideration for purchase of a product or service by a buyer to its seller. It is a very crucial decision for the marketers as consumers are very sensitive to the pricing. The factors affecting price determination are cost of product, the utility and demand, extent of competition in the market, government and legal regulations, pricing objectives and marketing methods used. ● Place: “It has five of its own retail shops.”Or “It also sells its products through various grocery shops.” It is considered an important element of marketing mix because it includes all those activities that help in making the goods and services available to the prospective buyers in the right quantity, at the right time and in right condition. The two main decisions involved in physical distribution are physical movement of goods from producers to consumers and choice of channels of distribution. ● Promotion: “It regularly uses different communication tools to increase its sales.” Promotion refers to the set of activities undertaken by a marketer to inform the prospective buyers about the product and persuading them to make a purchase. The various components of promotion mix are advertising, sales promotion, personal

selling and public relation.”

MODEL EXAMINATION – 2020-2021 ECONOMICS Grade :12 Time : 3Hrs Marks : 80 General instructions: i. All the questions in both the sections are compulsory. Marks for questions are indicated against each question. ii. Question number 1 - 10 and 18 - 27 are very short-answer questions carrying 1 mark each. They are required to be answered in one word or one sentence each. iii. Question number 11 - 12 and 28 - 29 are short-answer questions caring 3 marks each. Answers to them should not normally exceed 60-80 words each. iv. Question number 13 - 15 and 30 - 32 are also short-answer questions carrying 4 marks each. Answers to them should not normally exceed 80-100 words each. v. Question number 16 - 17 and 33 - 34 are long answer questions carrying 6 marks each. Answers to them should not normally exceed 100-150 words each. vi. Answer should be brief and to the point and the above word limit be adhered to as far as possible. SECTION-A (Macro Economics) 1. Higher the legal reserve ratio __________ will be the credit control (1) ( a ) higher ( b) lower ( c ) constant ( d ) none of these 2. D8 Receipts which do not affect asset or liability status of government (1) (a) capital receipts ( b ) revenue receipts ( c ) budgetary receipts ( d ) none of these 3. MPC being equal to 0.5, --------- will be ∆C, if income increases by 100 rupees. (1) (choose the correct alternative) a) 0.5 b) 50 c) 500 d) None of these 4. Name any two quantitative tools to control credit creation in an economy. OR Page 1 of 5

Define Fiat money (1) 5. Policy related to revenue and expenditure of the Government is known as ------------ (Choose the correct alternative) (1) a) Monetary Policy b) Foreign Trade Policy c) Fiscal Policy d) None of these 6. Revenue made by Govt from the property which do not have legal heir is known as------- -----(Fill up the blank with correct answer) (1) 7. State whether the given statement is true or false: (1) “There is an inverse relation between rate of foreign exchange and demand for foreign exchange”. 8. The sum of MPC and MPS is always equal to --------------(Fill up the blank with correct answer) (1) 9. From the set of statements given in Column I and Column II, choose the correct pair of statements: (1) Column I Column II (a) At the Break Even point (i) Equals National Income (b) If MPC is equal to one (ii) Value of k is infinity (c) Value of aggregate demand (iii) Depends upon investment (d) Consumption in the economy (iv) C > Y 10. The difference between fiscal deficit and interest payment is called________. (1) (Fill up the blank with correct answer) 11. Households and firms depend on each other in a circular flow of income”. Justify the statement in case of a Two- sector model. (3) 12. “Economists are generally concerned about rising Marginal Propensity to Save (MPS) in an economy”. Explain Why? OR If Personal disposable income is Rs. 1000 crore and the consumption expenditure is Rs. 750 crore, find out the Average Propensity to save. (3) 13. Discuss any one of the following functions of a central bank: (4) a) As Government‟s bank b) Open market operations. 14. „„Through its budgetary policy government allocates resources in accordance with the requirements of the country.‟‟ Do you agree with the given statement? Justify your answer with Valid reason. OR Page 2 of 5

DO you think Non-tax receipts are an important part of the budget? Examine different sources of Non-tax receipts in the budget. (4) 15. Supply of foreign currency rises in response to a rise in its exchange rate .How? (4) 16. From the following data, calculate National Income by Income Method: (a) Find Net value added at factor cost: (3) Items Rs in lakh i) Durable use producer goods with a life span of 10 years 10 ii)Single use producer goods 5 iii) Sales 20 iv)Unsold output produced during the year 2 v) Taxes on production 1 (b) How should the following be treated in estimated national income of a country? You must give reason for your answer. (3) i) Taking care of aged parents. ii) Payment of corporate tax. iii) Expenditure on providing police services by the government. OR Explain any 6 precautions to be taken while using the Income method. (6) 17. Diagrammatically represent Excess Demand. Also, analyze the monetary methods to correct the Excess demand. (6) SECTION-B (Indian Economic Development) 18. National Rural Employment Program me was launched in ___________ ( a ) 1965 ( b ) 1980 ( c ) 1970 ( d ) 1981 (1) 19. State whether the following statement is true or false (1) Urban Poverty is a spill-over of rural poverty. 20. Identify the correct sequence of alternatives given in Column II by matching them with respective terms in Column I: (1) Column – I Column – II A. Land Ceiling i. Increase in production of food grain using high yielding variety seeds B. Land reforms ii. Portion of agricultural produce sold in the market C. Green Revolution iii. Fixing the maximum limit of land holding for an individual. D. Marketed Surplus iv. Change in the ownership of land (land to tillers) 21. The scheme of Micro-finance is extended through ---------- (Choose the correct (1) alternative) (a) Self- help groups (b) Land development banks Page 3 of 5

(c) NABARD (d) Regional rural banks 22. HYV seeds were also called ................ (Fill up the blank with correct answer) OR ------------------is known as the “Indian Father of Green Revolution” (Fill up the blank with correct answer) (1) 23. _______ has the highest GDP growth rate as compared to India and Pakistan (1) 24. Choose the Correct alternative (1) Unemployment is calculated as: (1) (a) Labour force – Work force (b) Labour force + Work force (C) None of these 25. --------------- (1951/ 1921) year is known as the „Year of Great Divide‟ (Fill up the blank with correct alternative). 26. Arrange the following policies in chronological order (based on their launching date) and choose the correct alternative: (1) i. Sampoorna Gramin Rozgar Yojana (SGRY) ii. MUDRA Bank iii. Swarna Jayanti Shahri Rozgar Yojna (SJSRY) iv. Twenty Point Programme Choose the correct alternative: a) IV, III, I, II b) I, II, III, IV c) IV, III, I, II d) II, III, I, IV 27. ----------------was set to replace LQP in 1991. (Choose the correct alternative) (1) (a) LPG (b) PPC (c) LPE (d) None of these 28. How will you distinguish Labour Supply from Labour force? (3) OR How will you distinguish Open unemployment from Structural unemployment? 29. Describe the path of development initiatives taken by Pakistan for its economic (3) development ? . 30. Examine the role of On- the job training and migration in enhancing the quality of human capital. (4) Page 4 of 5

31. Enumerate any 4 arguments against the NEP,1991 (4) 32. Define the following terms (4) a) Disinvestment b) Import Substitution Define the following terms OR a) Outsourcing b) Quota 33. Explain the institutional sources of rural credit. (6) 34. Evaluate PAPS and write any 6 reasons why Poverty Alleviation programmes failed to deliver the desired results in some areas? OR Examine the role of education in the economic development of a nation ? (6) Page 5 of 5

Q.NO MODEL EXAMINATION 2020-21 ANSWER KEY 1. Higher 2. Revenue Receipts 3. 50 (MPC=change in consumption/ Change in income) 4. Bank Rate and Open market operations are the Quantitative measures. OR Fiat money is government-issued currency that is not backed by . a physical commodity, such as gold or silver, but rather by the government that issued it. 5. (C)Fiscal Policy 6. Escheat 7. True 8. The sum of MPC and MPS is always equal to one 9. (b) If MPC is equal to one – (ii) Value of K is infinity 10. Primary deficit 11. Circular flow 12. Households dispose of their post-tax income by spending or saving. Saving is a withdrawal from the circular flow of income and it has a pivotal role in determining changes in national income over time. This is known as Micro macro paradox. What is true at the micro level, may not be true at the macro level. Page 1 of 1

OR Y= C+S, therefore S=Y-C S= 250 Crores APS= S/Y= 250/1000= 0.25 13. A)The RBI acts as banker to the government the Central as well as state governments. It transacts all banking business of the government, which involves the receipt and payment of money on behalf of the government and carrying out of itsexchange, remittance and other banking operations. As government’s banker, the RBI provides short-term credit to the government to meet any shortfalls in its receipts over its disbursements. B) Open Market operations: It is the simultaneous sale and purchase of securities also known as open market operations – on behalf of the government. Open market operations enable a central bank to adjust liquidity or supply of money in the banking system. 14. Through the budgetary policy, government tries to reallocate resources in accordance with the economic and social priorities of the country. Government can influence allocation of resources through tax concessions or subsidies. Government discourages the production of harmful consumption goods like liquor, cigarettes etc. through the heavy taxes and encourages useful goods by using subsidies. OR Non tax receipts The estimates of Non-Tax Revenue receipts from various sources such as return on assets in form of dividend and profits, interest, fees, fines and Page 1 of 1

miscellaneous receipts collected in the exercise of sovereign functions, regulatory charges and license fees and user charges for publicly provided goods and services. Escheat refers to the income of the state which arises out of the property left by the people Without an legal heir. Grants and donations also form a part of non- tax receipts. 15. The supply of foreign currency rises in the following situations: When price of a foreign currency rises, domestic goods become relatively cheaper. It induces the foreign country to increase their imports from the domestic country. As a result, supply of foreign currency rises. 16. a) Net value added at factor cost = 15 lakhs. (b) i) Taking care of aged parents should be included in the estimation of national income as it involves generation of services that are rendered for the parents. ii) Payment of corporate tax should not be included in the estimation of national income because it is a transfer payment by the firm. It is paid out of income and therefore it is not to be separately added in the national income. 1 iii) Expenditure on providing police services by the government should be included in the estimation of national income because expenditure incurred by the government is a part of government’s final consumption expenditure. OR Transfer earnings like old age pensions should not be included. Income from illegal activities is not be included. Income from Windfall gains should not be included. Page 1 of 1

Imputed rent of owner occupied houses is to be treated along with rent. Corresponding to production for self- consumption, there should be generation Of income. 17. During excess demand, central bank increases the bank rate, which raises the cost of borrowings from the central bank. It forces the commercial banks to increase their lending rates, which discourages borrowers from taking loans. During excess demand, central bank offers securities for sale. Sale of securities reduces the reserves of commercial banks. It adversely affects the bank’s ability to create credit and decreases the level of aggregate demand in the economy. To correct the excess demand, the central bank increases CRR or/and SLR. It reduces the amount of effective cash resources of commercial banks and limits their credit creating power. When the economy is suffering from excess demand, central bank increases the margin, which restricts the credit creating power of banks. SECTION-B (Indian Economic Development) 18. 1980 19. Urban Poverty is a spill-over of rural poverty : TRUE Page 1 of 1

20. iii , iv, i , ii 21. a) Self- help groups 22. HYV seeds were also called Miracle Seeds OR MS Swaminathan is known as the “Indian Father of Green Revolution” 23.CHINA 24. (A) Labour force – Work force 25. 1921 26. (C)IV, III, I, II 27. (A)LPG has replaced LQP. 28.Labour Supply refers to supply of labour corresponding to different wage rates. Supply of labour is measured in terms of man days of work and is always related to wage rate. Labour force refers to number of persons actually working or willing to work. OR Structural Unemployment : This form of unemployment is largely defined as unemployment that results from perceived value and skills that an individual brings to a job against the needed, different skills required by an employer to do the job correctly. 29. For economic development Pakistan followed The different policies (i) A variety of regulated (ii) Protection of consumer (iii) The introduction of (iv) Public investment (v) Nationalisation of capital (vi) In 1980s, denatio (vii) In 1988, economic reforms were initiated in the economy. 30. On-the-job-training is a source of human capital formation as it increases the skill and efficiency of the workers and leads to an increase in production and productivity. Usually, it is Page 1 of 1

hypothesized that labour migration has a positive impact on human capital, because money remittances from labour migrants are spent on education of their household members, which raises the overall level of education in a country. 31. a (i) Raising the rate of economic growth of India to about 8 per cent at par with other Asian countries like Singapore, Malaysia, Hong Kong, South Korea etc. (ii) Economic reforms is helping the country to attain growing competitiveness in its industrial sector to face global competition. (iii) New Economic Policy aims to reduce the extent of poverty and inequality in the distribution of income and wealth. (iv) The new policy has been taking steps to raise the efficiency and profitability of public sector enterprises. 32. Disinvestment is when governments or organizations sell or liquidate assets or subsidiaries. Disinvestments can take the form of divestment or a reduction of capital expenditures (CapEx). Disinvestment is carried out for a variety of reasons, such as strategic, political, or environmental. Import substitution is a strategy under trade policy that abolishes the import of foreign products and encourages for the production in the domestic market. The purpose of this policy is to change the economic structure of the country by replacing foreign goods with domestic goods. until such time as it is can absorb investment more easily and also trade its own products. Outsourcing is the business practice of hiring a party outside a company to perform services and create goods that traditionally were performed in-house by the company's own employees and staff. Page 1 of 1