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CBSE class 11 commerce Business studies fast track revision notes

CBSE class 11 commerce Business studies fast track revision notes:- we will provide complete details of CBSE class 11 commerce Business studies fast track revision notes in this article.

CBSE class 11 commerce Business studies fast track revision notes

FORMS OF BUSINESS ORGANISATION

Introduction: Decision relating to the form of organization plays an important role if one has to start a business.

CBSE class 11 commerce Business studies fast track revision notes

The forms of organization are

  1. Sole proprietorship
  2. Partnership
  3. Joint Hindu Family business.
  4. Co-operative society
  5. Joint Stock Company.

Important Concept

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Meaning of Sole Proprietorship: It refers to a form of business organization which is owned, managed and controlled by an individual who is in receipt of all profits and bearer of all risks.

Features:

  1. Easy to form and close
  2. Liability
  3. Only bearer of profit and loss
  4. Control
  5. No separate entity.
  6. Lack of business continuity.

Merits:

  1. Quick decision making
  2. Personal satisfaction
  3. Information will be kept secretly
  4. Direct incentive
  5. Ease of formation and closure.

Demerits:

  1. Limited resources
  2. Limited life of a business concern.
  3. Unlimited liability
  4. Limited managerial ability.

Meaning of Joint Hindu Family Business: Karta eldest member of the family controls the business.

Features:

  1. Formation
  2. Liability
  3. Control
  4. Continuity
  5. Minor members.

Merits:

  1. Effective control
  2. Continuity of business
  3. limited liability of members
  4. Increased loyalty.

Demerits:

  1. Limited resources
  2. unlimited liability of karta
  3. Karta’s dominance
  4. limited managerial skills.

Meaning of Partnership: Relation between persons to share the profits of the business carried on by all the partners or any one of the partner acting on behalf of all the other partners

Features:

  1. Formation
  2. Liability
  3. Risk bearing
  4. decision making
  5. continuity
  6. Member

Merits:

  1. Easy to start and close
  2. proper decision making
  3. More money
  4. secrets are maintained.

Limitations:

  1. Unlimited liability
  2. Fights exist
  3. Chances for closure
  4. No public confidence.

Types

  1. Active
  2. sleeping
  3. secret
  4. Nominal
  5. partner by behaviors
  6. partner by holding out.

Formation of a Company

STAGES

Promotion: Functions of a Promoter: (i) Finding out a business opportunity (ii) Conducting studies (iii) Getting the name approved. (iv) Fixing up persons to sign Memorandum of association (v) Appointment of professionals.(vii) preparation of necessary documents.

Documents: Memorandum of association: (i) Name clause (ii) Registered office clause (iii) Objects clause (iv) Liability clause (v)Capital clause (vi) Association clause. (vii) Articles of association. (viii) Consent of directors (ix) Agreement with managing director or whole time director (x) Statutory declaration

Incorporation: The memorandum of association must be duly stamped, signed and witnessed. (ii) The articles of association duly stamped and witnessed. (iii)Written permission of the directors. (iv) Agreement with the managing director/manager.(v)A copy of the registrar’s letter giving permission for the name. (vi) A declaration that all the legal requirements are followed.(vii) A notice about the exact office of the registered office. (viii) Documents showing the payment of fees.

Capital subscription: (i) SEBI approval (ii) Filing of prospectus. (iii) Appointment of brokers, bankers etc., (iv) Collection of minimum subscription (v) Application to stock exchange (vi) Allotment of shares.

Commencement of Business:

(i) A declaration about meeting minimum subscription requirement. (ii) A declaration regarding the application and allotment money paid by the directors as same as others. (iii) A declaration that no money is payable to the applicants because of the failure of the company. (iv) A statutory declaration that the above particulars are followed. (v) The registrar shall examine the documents if these are found satisfactory a certificate of commencement of business will be issued.

Types of Partners :

  1. Active partner: An active partner is a partner who gives capital, participates in management, shares the profits and losses and has unlimited liability.
  2. Sleeping partner: A Partner who do not take part in the business activities.
  3. Secret partner: A partner who has association with the firm but unknown to the public.
  4. Nominal partner: A partner who allows his name to be used by the firm
  5. Partner by estoppel: A person who by behaviour sets an impression to others that he/she is a partner of the firm.
  6. Partner by holding out: A person who is not a partner but allows himself to be represented as partner in a firm.

Public Company:

  1. Members: Minimum 7, Maximum unlimited
  2. Minimum number of directors: 3
  3. Minimum paid up capital: 5 lakhs.
  4. Index of members: Compulsory.
  5. Transfer of shares: Shares can be transferred easily from one person to another.
  6. Invitation to public: It can invite the public to purchase the share and debentures

Private Company:

  1. Members: Minimum 2, Maximum -50.
  2. Minimum number of directors: 2
  3. Minimum paid up capital: 1 lakh
  4. Index of members: Not compulsory.
  5. Transfer of shares: Shares cannot be transferred from one person to another.
  6. Invitation to public: It cannot invite the public to purchase the share and debentures.

Meaning of Cooperative Society:

It is a voluntary association of persons formed for protecting the consumers from middlemen.

Features: (i) Voluntary association (ii) service motive (iii) power to take decisions (iv) limited liability.(v) Registration is compulsory so they have legal status.

Merits: (i) Equal voting rights. (ii) Continuous existence (iii) low cost of operation (iv) Government support (v) Easy to start (vi) limited liability. Limitations: (i) Resources are little (ii) Difference of opinion. (iii) Management is not proper (iv) Strict rules from the government.

Types: (i) Consumer (ii) Producer (iii) Marketing (iv) Farmer’s (v) Credit (vi) Cooperative housing societies

Meaning Of Joint Stock Company: Company is an artificial person with continuous existence& common seal.

Features:(i) Artificial person (ii) Formation is difficult (iii)Company has separate identity.(iv)Continuous existence (v) Control of the company is made by directors.(vi)liability is limited.(vii) Common seal.

Merits: (i) Liability is limited (ii) Chances are there for expansion (iii) Managed by professional people (iv) Continuous existence (v) Shares can be easily transferred from one person to another person.

Demerits: (i) Very difficult to form (ii) No secrecy (iii) No personal involvement.(iv)More rules and regulations. (v) very slow in decision making (vi) owners have less control.

Types of Companies: (i) Private company (ii) Public company.

Choice of form of Business organization: (i) less costly in setting up the organization (ii) Limited liability (iii) continuous existence (iv) Form of raising capital (v) Control to be made (vi) Nature of business.

CBSE class 11 commerce Business studies fast track revision notes

Important Note – Preparing for XI & XII Commerce?
CAKART provides Indias top faculty each subject video classes and lectures – online & in Pen Drive/ DVD – at very cost effective rates. Get video classes from CAKART.in. Quality is much better than local tuition, so results are much better.
Watch Sample Video Now by clicking on the link(s) below – 
For any questions Request A Call Back  

Recommended post :-CBSE class 11 commerce Business studies fast track revision notes

CBSE class 11 commerce Business studies fast track revision notes

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