class 11 Commerce NCERT solutions – complete details
class 11 commerce ncert solutions:- we provide details class 11 commerce ncert solutions including Accountancy , Business Studies and Economics in this articles.
class 11 commerce ncert solutions
class 11 commerce ncert solutions:-NCERT Solutions for Class 11 Accountancy
class 11 commerce ncert solutions:-Accountancy : Financial Accounting Part-1
Q1 : Define accounting.
Answer :Accounting is a process of identifying the events of financial nature, recording them in Journal, classifying in their respective ledgers, summarising them in Profit and Loss Account and Balance Sheet and communicating the results to the users of such information, viz. owner/s, government, creditors, investors etc.
According to the American Institute of Certified Accountants, 1941, “Accounting is an art of recording, classifying and summarising in a significant manner and in terms of money transactions and events that are, in part at least, of a financial character and interpreting the results thereof.”
Q2 : State what is end product of financial accounting?
- Income statements (Trading and/or Profit and Loss Account)- An income statement that includes Trading and Profit and Loss Account, ascertains the financial results of a business in terms of gross (or net) profit or loss.
- Balance Sheet- It depicts the true financial positions of a business that provides required information like assets and liabilities of a business firm, to the users of accounting information like owners, creditors, investors, government, etc.
Q3 : Why is it necessary for accountants to assume that business entity will remain a going concern?
Answer : Going Concern Concept assumes that the business entity will continue its operation for an indefinite period of time. It is necessary to assume so, as it helps to bifurcate revenue expenditure (i.e. expenditure related to current year), and capital expenditure (i.e. expenditure whose benefits accrue over a period of time). For example, a machinery that costs Rs 1,00,000, having an expected life of 10 years, will be treated as a capital expenditure, as its benefit can be availed for more than one year; whereas, the per year depreciation of the machinery, say Rs 10,000, will be regarded as a revenue expenditure.
Q4 : When should revenue be recognised? Are there exceptions to the general rule?
Answer : Revenue should be recognised when sales take place either in cash or credit and/or right to receive income from any source is established. Revenue is not recognised, in case, if the income or payment is received in advance or the payment is actually received from the debtors. In a nutshell, revenue will be recognised when the right to receive income is established. For example, Mr. A sold goods in January and received payment in February; then revenue is considered to be recognised in the month of January and not in February. However, if Mr A received cash in advance, i.e. in December and goods are sold in January, then the revenue is recognised in January and not in December.
The exceptions to this rule are given below.
1) Hire purchase- When goods are sold on hire-purchase system , the amount received in instalments is treated as revenue.
2) Long term construction contract- The long term projects like construction of dams, highways, etc. have long gestation period. Income is recognised on proportionate basis of work certified and not on the completion of contract.
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class 11 commerce ncert solutions:-NCERT Solutions for Class 11 Economics
Q1 : Make a list of activities that constitute the ordinary business of life. Are these economic activities?
Answer :The following are the activities that constitute the ordinary business of life:
1. Buying of goods and services.
2. Rendering services to a company by employees and workers.
3. Selling of goods and services.
4. Production process carried out by a firm.
Yes, the above mentioned activities are regarded as economic activities. This is because, these activities involve the use of scarce resources to carry out production, consumption, saving, investment, etc. These activities involve the exchange of money to earn livelihood.
Q2 : What was the focus of the economic policies pursued by the colonial government in India? What were the impacts of these policies?
Answer : The main focus of the economic policies pursued by the colonial government was to make India a mere supplier of Britain’s own flourishing industrial base. The policies were concerned mainly with the fortification and advancement for their home country. The interests of the Indian economy were completely ignored. Such policies brought structural changes in the Indian economy by transforming it to a supplier of raw materials and consumer of finished products from Britain. The impacts of these policies are discussed as follows in detail;
i. Low Economic Development
Throughout the British rule, Indian economy experienced very low level of economic development. As per some researches, Indian economy grew at even less than two percent during 1900-50. The reason for such a low level of development was that the British government was more concerned with the promotion of economic interests of their home country. Consequently, the colonial rule transformed India’s agriculture sector to a mere supplier of raw materials for the British industries. This not only affected the production of the agricultural sector but also ruined the small manufacturing units like handicrafts and cotton industries. These manufacturing units faced a stiff competition from the British machine made textiles and handlooms.
ii. Backwardness of Indian Agriculture
Under the colonial rule, India was basically an agrarian economy employing nearly 85% of its population. Nevertheless, the growth of the agriculture sector was meager. This was due to the prevalence of various systems of Land Settlement, particularly Zamindari system. Under this system, the zamindars (owners of land) were required to pay very high revenue (lagaan) to the British government, which they used to collect from the peasants (landless labourers, who were actually cultivating). The zamindars were mainly concerned with extracting high revenues from the peasants but never took any steps to improve the productivity of the land. Moreover, in order to feed British industries with cheap raw materials, the Indian peasants were forced to grow cash crops (such as, indigo, cotton, etc.) instead of food crops (such as, rice and wheat). This commercialisation of agriculture not only increased the burden of high revenues on the poor peasants but also led India to face shortage of food grains. Therefore, Indian agriculture remained backward and primitive.
iii. Deindustrialisation of Indian Economy
India failed to develop a sound and strong industrial base during the colonial rule. The status of industrial sector during the British rule can be well defined by the term ‘systematic deindustrialisation’. The cause of deindustrialisation can be attributed to the downfall of India’s handicraft industry and the cause of bleak growth of modern industry was the lack of investment. On one hand, the British government imposed heavy tariffs on the export of Indian handicraft products and on the other hand, allowed free exports of Indian raw materials to Britain and free imports of British products to India. As a result of the heavy tariffs, the Indian exports became costlier and its demand in the international market fell drastically that led to the collapse of Indian handicrafts industries. Simultaneously, the demand for the handicrafts products also fell in the domestic markets due to stiff competition from the machine made textiles of Britain. As a result, the domestic industries lacked investment and growth initiatives.
iv. Regression in Foreign Trade
During the colonial rule, the British government owned the monopoly power over India’s foreign trade. The British government used the trade policy according to the interests of their home country. The exports and imports transactions were restricted only to India and Britain. On one hand, the exports from India provided the cheap raw materials to the British industries and on the other hand, India’s imports from Britain provided a virgin market for Britain’s products. In either ways, British industries were benefitted. Moreover, the surplus generated from t foreign trade was not invested in the Indian economy; instead it was used in administrative and war purposes by Britain to spread their colonial power.
Q3 : Name some notable economists who estimated India’s per capita income during the colonial period.
Answer : As the British government was never interested in upliftment of our country, so they never took any initiative to measure India’s national and per capita income. Though some of the economists tried to estimate India’s national income and per capita income during the colonial rule, but the results are mixed and conflicting. The following are some of the notable economists who were engaged in estimation of national income and per capita income:
i. Dadabhai Naroji
ii. William Digbay
iii. Findlay Shirras
iv. V.K.R.V Rao
v. R.C. Desai
Out of these, V.K.R.V Rao’s estimates are considered to be significant. Most of these studies revealed that Indian economy grew at even less than two percent during 1900-50 with half per cent growth in per capita output per year.
Q4 : Define a plan.
Answer : A plan is a proposed list of goals that an economy wants to achieve within a specific period of time. It suggests the optimum ways to utilise the scarce available resources to achieve the enlisted goals. In India, planning is done for a period of five years, which is called five year plan. Plans have both specific and general goals. Some of the common goals are economic growth, modernisation, self-reliance and equity. Plans lay down the basic framework over which the policies are designed. Often various goals are conflicting to each other, for example, modernisation reduces labour employment. So there is a need to maintain a balance among different goals.
Q5 : Why did India opt for planning?
Answer : Soon after independence, India faced an important choice to opt either for capitalism or socialism. Finally, India, inspired by the extraordinary success of planning in Soviet Union, opted for socialism. Although, Indian political and economic conditions were not as favourable as it was for Soviet Unions to opt for socialism, yet India adopted socialism but with a difference. India hinged upon the socialist idea with a strong emphasis on public sector and active participation of the private sector in a democratic framework. The Planning Commission (1950) was established with the motive that the government would undertake comprehensive planning for the nation as a whole, where public sector would lay down the basic economic framework and would encourage private sector for their active contribution to the economic growth.
class 11 commerce ncert solutions:-NCERT Solutions for Class 11 Business Studies
Q1 : Define services and goods?
Answer : Services are intangible activities that require personal interaction between the consumer (purchaser of the service) and the service provider (seller of the service) at the time of delivery. The services need not involve any production or sale of goods. Generally, services are classified into the following two categories.
(a) Business services: These include banking, insurance and warehousing services.
(b) Professional services: These include legal services, medical advice and tax consultancy.
In contrast to services, the term ‘goods’ refers to physical and tangible objects whose ownership gets transferred to the buyers as soon as he or she purchases these objects. Examples of goods are televisions, radios and shoes.
Q2 : State any three differences between e-business and traditional business.
Answer : The differences between traditional business and e-business are presented in the table below.
|Basis of difference||Traditional business||e-Business|
|Ease in formation||Formation is relatively difficult as there exist numerous formalities that are required to be fulfilled.||Relatively easier to start.|
|Internal communication||Follows a hierarchical communication structure (from top to bottom)||Follows a non-hierarchical communication structure (no defined structure)|
|Start-up cost||Heavy start-up cost||Relatively low start-up cost (as physical facilities are not required)|
|Market access||Access is restricted to the physical domain.||Access is comparatively wide and unlimited.|
Q3 : What do you understand by social responsibility of business? How is it different from legal responsibility?
Answer : Social responsibility refers to the duties and responsibilities of business enterprises towards society and its members. It implies the obligation on an enterprise to conduct activities that are favourable from the viewpoint of society. As any business makes use of society’s resources in the form of human and physical capital, it becomes the moral duty and responsibility of the businesspersons to work for the betterment of society.
Social responsibility differs from legal responsibility on various grounds. Social responsibility is a much wider concept than legal responsibility. This is because, by mere compliance with the law, any legal responsibility can be fulfilledâ€”for instance, paying taxes on time and reducing the emission of pollutants. On the other hand, social responsibility is an obligation on business enterprises to work for the welfare of societyâ€”for example, generating employment opportunities to the physically challenged and providing equal employment opportunities to women.
Q4 : What is meant by internal trade?
Answer : Internal trade refers to the process of exchanging goods and services within the national boundaries of a country. In other words, the buying and selling of goods and services within the domestic territory of a country is known as internal trade. Purchases of goods from a local shop, a mall or an exhibition are all examples of internal trade. The government does not levy customs or import duties on goods and services that are produced within the country for meeting the domestic demand.
Internal trade can be classified into the following two categories:
(a) Wholesale trade: It refers to the buying and selling of goods in bulk-that is, the exchange of large quantities of goods meant for resale in local markets.
(b) Retail trade: It refers to the buying and selling of goods in small quantities for final consumption.
class 11 commerce ncert solutions:- Q5 : Itinerant traders have been an integral part of internal trade in India. Analyse the reasons for their survival in spite of competition from large scale retailers.
Answer : Itinerant traders are retailers who do not have a fixed place of operation. That is, they do not have a shop from where they sell their products. They are also known as mobile traders as they keep moving from place to place in order to sell their products. They are generally found on street sides, and they shift their place of operation in search of more customers. They usually sell low-priced and non-standard goods.
The reasons that itinerant traders survive in spite of the tough competition from large-scale retailers can be attributed to the following factors:
(a) Low price of goods: Itinerant traders generally deal in low-priced goods that are of daily use to customers, such as toiletries, vegetables, fruits, etc. These traders do not have to spend on storage and advertising, and they keep their inventories short and limited. Hence, the prices of their goods are lower than the prices of goods sold by large-scale retailers.
(b) Personal attention to customers: Itinerant traders deal directly with consumers and are, therefore, able to give more attention to them. As they supply goods to customers at their doorstep, they provide greater customer-care services by eliciting proper feedback and passing on the information to manufacturers.
(c) Easy availability at short notice: Itinerant traders move from place to place and provide goods at the customer’s doorstep. On the other hand, large-scale retailers have shops in central locations away from residential areas, and it is often difficult for customers to buy goods at the time they require them. Therefore, they depend on itinerant traders.
(d) Lower possibility of losses: Large-scale retailing involves a higher probability of incurring losses, because the retailers concerned deal in high-priced goods. Thus, in case the tastes and preferences of customers change, large-scale retailers are forced to sell the goods that have fallen out of favour. These goods are often sold at low prices in clearance sales, causing huge losses to the retailers. On the other hand, as itinerant traders deal in consumer goods that are low priced and of daily use, the probability of their incurring losses is minimised.
class 11 commerce ncert solutions
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class 11 commerce ncert solutions
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