Solving ICSE Class 10 Commercial Applications Previous Year Question Papers ICSE Class 10 Commercial Applications Question Paper 2016 is the best way to boost your preparation for the board exams.
ICSE Class 10 Commercial Applications Question Paper 2016 Solved
Section – A (40 Marks)
(Attempt all questions from this section)
Question 1.
State a difference between each of the following:
(a) Marketing and Selling. [2]
(b) Renewable resources and Non-renewable resources. [2]
(c) Apprenticeship Training and Internship Training. [2]
(d) Direct Cost and Indirect Cost. [2]
(e) Cash credit and Overdraft. [2]
Answer:
| (a) | Marketing | Selling |
| Total system consisting of planning, pricing, promoting and distributing products. | A part of marketing involving persuasion and directing flow of products to customers. | |
| (b) | Renewable resources | Non-renewable resources |
| It can be used again and again. | It cannot be used again and again. It is used only once. | |
| (c) | Apprenticeship Training | Internship Training |
| This method is used in technical trades and crafts in which a long period is required to become proficient. | This is a joint programme of training in which business houses collaborate with technical institution. | |
| (d) | Direct cost | Indirect cost |
| Directly and wholly related to a particular unit or centre of cost. | Not directly and wholly related to a particular unit or centre of cost. | |
| (e) | Cash Credit | Overdraft |
| Persons not holding current accounts are eligible for cash credit. | Only current account holders are eligible for overdraft. |
Question 2.
(a) What are convenience products ? Give two examples. [2]
(b) What is understood by the Going Concern Concept of Accounting ? [2]
(c) Mention any four causes of the Greenhouse Effect. [2]
(d) What are the advantages of ‘Account Payee ’ crossing of a cheque ? [2]
(e) What is a ‘Recurring Deposit Account’? [2]
Answer:
(a) These products are purchased frequently and with minimum efforts. They are meant for personal convenience. Examples – Newspapers and toothpastes.
(b) This concept assumes that the business will continue for an indefinite period of time. The transactions are recorded in the books of the business on the assumption that it is a continuing enterprise. In the absence of this assumption, no business will purchase fixed assets but only nice them.
This assumption is very important as no outsider will enter into any long term contract with the business. For example, no customer will purchase the product or service of a company which is going to be closed after three or five years. This assumption justifies classification of fixed assets and current assets as well as short – term and long – term liabilities.
(c) The four causes of the‘greenhouse effect’ are as follows:
(i) Carbon dioxide:
Carbon dioxide is released into the environment every time as fossil fuels are burnt for energy by factories, power plants and automobiles. The amount of carbon dioxide is increasing rapidly due to increasing number of vehicles, factories, power plants and automobiles.
(ii) Water vapour :
Atmospheric water vapour is a significant greenhouse gas. Increased water vapour and changes in atmospheric circulation could also create changes in cloud cover.
(iii) Methane :
Hydroelectric reservoirs and bacterial decomposition of flooded peat and forest biomass generate methane. Methane’s capacity to absorb heat is about 25 times more than that of carbon dioxide. Methane contributes about 12 percent of Greenhouse effect.
(iv) Ozone :
Ozone also has a role in the green house effect. Global warming potential of ozone is about 2000 times that of carbon dioxide.
(d) A crossed cheque cannot be in cash at the counter of the bank. A crossed cheque is payed into the bank account of a person. Crossing of cheque provide protection or against loss to the depositor.
(e) In this account, the account holder is required to deposit a specific amount every month. After the expiry of the specified period, the depositor gets back his money together with interest on it.
Question 3.
(a) Explain any two qualities of a good salesman. [2]
(b) What are Open Market Operations of a Central Bank ? [2]
(c) Why are interviews an essential part of the selection procedure ? [2]
(d) What is ‘Indirect Labour Cost’? [2]
(e) Mention any two features of Balance Sheet. [2]
Answer:
(a) The two qualities of a good salesman are :
- Sincere : A good salesman is always loyal and committed to his work. He is dependable and cpurageous. He requires a cool temperament and enthusiasm.
- Sensitive: A successful salesman should be sensitive to the needs and expectations of customers. He is a good listener and has patience.
(b) The open market operations mean the sale and purchase of securities by the Central Bank in the open market. When the Central Bank wants to reduce the volume of credit, it sells securities in the market. Sale of securities props up cash reserves of commercial banks towards the Central Bank.
(c) Interviews are an essential part of the selection procedure because, this is the occasion when candidates come into contacts with the company’s officials. The purpose for interview is to ascertain the minimum qualification, experience, age, etc., of candidates. The candidates who are unfit for the job are rejected.
(d) Indirect labour cost means the labour which cannot be wholly and directly identified with a particular period.
(e) The two features of a Balance Sheet are :
- It is not an account but a statement.
- A Balance Sheet is always prepared on a particular date.
Question 4.
Justify a reason either for or against each of the following:
(a) On the job training includes practical and theoretical learning. [2]
(b) A demand draft is preferable to a cheque. [2]
(c) Central Bank is the lender of last resort. [2]
(d) Training is related to improving skills for performing a job. [2]
(e) In a competitive market, parity pricing is the appropriate strategy. [2]
Answer:
(a) On the job training includes only practical learning because the employees are working and learning, that’s why they are not able to write or understand in the board. The officials understand them when they are doing work with the machines.
(b) A demand draft is preferable to cheque because when a cheque is lost then any person who finds the cheque can withdraw the money and when a draft is lost then no more withdraw except the account holder of that draft.
(c) The Central bank acts as the bank for all commercial banks need in the country. When a commercial bank needs fund it can obtain loans and rediscounts its bills with the central bank. Therefore, central bank is called the tender of last resort.
(d) Training is related to improving skills for performing a job because training improves the skills of the employee. Without training no skills can be improved. Without training if the employee does the job in a company, then he cannot used machines properly. So he requires to do training first. So as to handle the machines properly.
(e) Parity pricing is an appropriate strategy. The reason is : It may be less troublesome and less costly than an individualistic pricing strategy.
Section – B (60 Marks)
(Attempt any FOUR Questions)
Question 5.
(a) Explain ‘Sales-Oriented Stage ’and ‘Marketing-Oriented Stage’. [5]
(b) Why is Service becoming more important than a Product ? Give five reasons. [5]
(c) Explain any five steps generally involved in the selection of employees. [5]
Answer:
(a) Sales – Oriented Stage :
The Great Depression resulted in a situation that questioned the thinking / strategy of business firms. Drastic changes in buying habits and behaviour of consumers, technological advancements in transportation and communication and growth of corporate form of organisation also changed the thinking. The focus shifted from production to selling.
How to sell became a problem and the new motto was to get rid of what you have. Producers began to realise that consumers will not buy enough unless they are approached with substantial selling and promotional efforts. The focus was on increasing sales rather than on consumer satisfaction.
Demand outstripped supply and it was still a seller’s market. Thus, the sales – oriented stages was characterised by hard selling. In the process of aggressive selling unscrupulous practise occurred. Salesmanship was the focus of marketing activities because product could not be sold without any effective sales force.
Marketing Oriented Stage : Consumer awareness forced to the producers to promote marketing. The aim of marketing should be to know and understand the customer so well that the product or service fits him or her and thus sells itself.
(b) The five reasons are :
(i) Increasing Urbanisation :
Urbanisation has been another cause of expansion of service sector in India. There has been shifting of population from rural to urban areas. Urbanisation leads to rise in demand for infrastructure services such as communications, public utilities.
(ii) Media :
Television, internet and other media have led to spurt in tourism. Modem technology has made business more comfortable. Tourism in turn has promoted all types of services such as hotel, restaurants, travel agents, amusement parks, event management etc. Expanding world trade has also had a demonstration effect.
(iii) Rise in Per Capita income :
Growing per capita income has led to demand for new and better services. Interior decoration, garden care, beauty parlours, slimming centres, health clubs etc. are examples of these services. More leisure time creates demand for recreation and entertainment services such as water parks etc.
(iv) Women workforce :
Higher percent age of women in workforce has created demand for baby sitting, household domestic helps and such other personal services.
(v) Greater Life Expectancy :
Increase in life span has led to great demand for health care and related services. Greater concern for ecology and resource scarcity requires time sharing, pollution control.
(c) The five steps generally involved in the selection of employees are:
(i) Preliminary Interview :
Preliminary Interview is the first occasion when candidates come into contact with the company’s official. The job seekers are received by the receptionist or some other official who conducts a brief interview of the candidates to fill up the application form. The purpose of preliminary interview is to ascertain the minimum qualifications, experience, age etc. of candidates. The candidates who are obviously unfit for the job are rejected.
(ii) Application Form :
The candidates who succeed in preliminary interview are asked to fill in the prescribed application form. The application form provides a written record of the name, address, age, qualifications, work experience etc. of a candidate. It reflects the handwriting and expression of the candidate and serves as the basis of interview. Therefore, application form should be designed carefully so as to secure all the relevant information about the candidates. There is no standard application form for all jobs or all firms.
(iii) Employment Tests :
Tests are becoming popular in employee selection. These tests are based on the assumption that work behaviour of a person can be predicted by sampling it. There are several types of tests and the right type of tests should be used. Tests are more useful for identifying unsuitable candidates than for selecting appropriate candidates.
(iv) Selection Interview :
An interview is a purposeful exchange of ideas and information between two or more persons. Interview serves as a means of checking the information obtained through application form and tests. It also provides an opportunity to the candidate to get information about the job and the company. Managers can judge the personality, communication skills and suitability of the candidate through face to face contact. Selection interview should be conducted in an atmosphere which is free from noise, disturbance and interruption.
(v) Medical Examination :
A physical examination of the candidates is necessary to ensure that they are physically fit for the job. Such an examination also help to protect the employer against the risk of claims for compensation from individuals who already suffer from disabilities and diseases. Medical examination should record a complete medical history, current physical capabilities and nature of disabilities.
Question 6.
(a) Explain the five consumer rights as per the Consumer Protection Act. 1986. [5]
(b) Explain any two elements of Public Relations. [5]
(c) ‘All vacancies at various levels in an organisation cannot be filled through an internal source of recruitment’. [5]
Explain any five external sources of recruitment.
Answer:
(a) The five consumer rights are :
- Right to choose : It means the right to be assured whenever possible, of access to a variety of goods and services at competitive prices. It also includes the right to consumers of basic goods and services.
- Right to be heard : It means consumer’s interest must receive the consideration at appropriate forums. It also includes the right to be represented various forums constituted to consider the welfare of consumers.
- Right to seek redressal : It means right to seek redressal against unfair trade practices or unscrupulous exploitation of consumers. It also includes the right to fair settlement of the genuine grievances of consumers.
- Right to consumer education : It means the right to acquire the knowledge and skill to be an informed consumer. Consumers must not only know but also exercise their rights. Only then real consumer protection can be achieved. Consumers are exploited mainly due to their ignorance and indifference.
- Right to informed : It means right to be informed about the quality, quantity, purity, potency, standard and price of goods. By getting all such information, consumers can make the right choice and protect themselves from unfair trade practices.
(b) The two elements of Public Relations are :
(i) Human Relation :
Human relation means relations between human being on the basis of human dignity and respect for each other. Good human relations require that people are getting along well together with the ‘internal publics’ as well as ‘external publics’. Every person employed in an organisation is a human being. Therefore, each should be aware of the others and should show sincere interest in his official and personal progress. Employer or management can buy a person’s time and actions.
These things have to be earned through good human relation.
(ii) Empathy :
Empathy means looking at things and events from the other’s point of view. It requires that the communicator be in tune with the communicate. The former should understand the attitude of the latter. For example, a good speaker should know the emotions and sentiments of his audience. Knowing the emotions and sentiments of his audience. Put yourself in the shoes of the listener before you speak. Similarly as the writer should show consideration in the reader.
(c) The five external sources of recruitment are :
(i) Advertisements:
Advertisements in newspapers and journals are the most widely used method of attracting candidates for all types of jobs. The requirement of the job and terms and condition of employment are given in the advertisements. Candidates evaluate themselves against job requirement and send applications. Advertisements bring in a large number of applications due to wide circulation of a national newspaper. This method is convenient and economical also.
(ii) Placement Agencies:
Private employment agencies can be engaged for recruiting staff. These agencies advertise the vacancies, receive applications, conduct interviews and shortlist candidates on behalf of employers. But they charge fee for their services. These agencies have become a popular source for recruiting managerial and technical personal.
(iii) Gate hiring :
Small firms make recruitment at the factory gate. Workers gather at the factory gate. Workers gather at the factory gate after reading the notice of vacancies. The suitable candidates are selected. This method is used to fill temporary and casual vacancies.
(iv) Recommendations :
Applicants introduced by friends and relatives can be source of recruitment. When an existing employee or a business friend recommends a person, a sort of preliminary screening takes place. In some firms, candidates recommended by the trade unions are given preference.
(v) Jobbers and contractors :
It is quite common to engage contractors for the supply of labour, When workers are to be hired at a short notice and without going through the usual selection procedure, jobber and contractors maintain close links with small towns and villages. Therefore they are good sources of unskilled labour.
Question 7.
(a) Explain fixed cost with suitable example. [5]
(b) Explain variable cost and semi-variable cost with suitable examples. [5]
(c) Explain the first two stages of Product Life Cycle. [5]
Answer:
(a) Fixed cost are those costs while remain fixed in amount irrespective of changes in the volume of output during a given period of time such costs do not change which can be easily, directly and wholly related to a particular cost unit or cost centre. These consist of direct material cost, direct labour cost.
(b) Variable cost: Variable costs are those costs which vary in amount with changes in the level of output or activity. Such costs increase or decrease in such proportion in which the level of output increases or decreases. Semi-Variable Cost: Semi-variable costs are those costs which vary but not in direct proportion to changes in the volume of production. They are combination of fixed and variable costs.
(c) The first two stages of product life cycle are :
(i) Introduction stage:
After research and development the new product will be launched in the market cost incurred in launching the product will be high and sales may be low. Since the product is of a new variety. Competition is virtually absent, market is limited and prices are relatively high. This stage is also very risky because of high percentage of new product fail during this period.
(ii) Growth stage :
Sales increases and competitors enter the market. Having covered its research and development costs the product becomes profitable. In this stage, promotional focus shifts from “buy my product to buy my brand”. Strategies like heavy advertising, expanding distribution channels and keeping the price at competitive levels may be employed.
Question 8.
Write short notes on :
(a) (i) Principle of Timeliness. [5]
(ii) Money Measurement Concept.
(b) Newspapers as a media for advertising. [5]
(c) Narmada Bachao Andolan and the Chipko Movement. [5]
Answer:
(a) Write a short notes on :
(i) Principle of Timeliness :
Financial statements provide useful information on the basis of which user take important decision. Therefore, this principle states that the financial statements should be prepared quickly at the end of the accounting period. They should be made available to the users at the earliest possible time.
(ii) Money Measurement Concept :
On- the basis of this concept, only those transactions are recorded in accounts which can be expressed in terms of money. For example, the retirement of the chairman of the company cannot be recorded because it is not possible to measure the monetary effect of retirement except in terms of gratuity and other benefits payable to the chairman. Money is a common denominator.
(b) Newspapers are popular and widely used medium of advertising. Its main advantages are :
- Due to wide coverage cost per leader is low.
- There is continuity as the message can be repeatedly daily.
- There is flexibility as the message can be modified frequently.
- Regional newspapers can be used to focus on selected areas.
(c) Narmada Bachao Andolan :
This was started in 1986 under the leadership Medha Patkar. It aimed primarily to educate those directly affected about the social and environmental impact of large development projects. It began as a protest against the construction of dams in the Narmada Valley in general.
Chipko Movement: In the 1970s an organised resistance to the destruction of forests spread throughout India. It came to know Chipko Andolan. Chipko literally means hug the trees. The movement was lead by Sunder Lai Bahuguna and several other civil society leaders Ghaushyam Raturi, the Chipko poet wrote a poem. Its main aim was to save the trees.
Question 9.
Case Study
Maruti Nero, a product of the Maruti group has created a very good reputation in the automobile market. It has nearly 180 outlets and operates in nearly 100 cities. The company provides genuine spare parts and 24/7 roadside assistance with longest warranty coverage. It has collaboration with Tata Motors regarding its sale, service and spares. There are many dealers of Tata motors in Delhi and outskirts, so this has rapidly increased the sale of the car. The company normally goes for institutional advertising in most of the cases. It is indeed a reality that Maruti with minimum advertising has become a popular brand.
With reference to the above :
(a) What is Institutional advertising ? State and explain the other types of advertising. [5]
(b) What is a brand promotion ? Explain the methods used for brand promotion. [5]
(c) Suggest and explain any two suitable media to be used by the company to advertise its product. [5]
Answer:
(a) The aim of the advertising which is to build a favourable image of the organisation rather than to promote the sale of a product or service is called institutional institution. Other types of advertising are :
- Informative Advertising : This type of advertising contains information about the product or services.
- Persuasive Advertising: This type of advertising is designed to persuade the consumers to buy a product or service to support an idea.
- Reminder Advertising: It attempts to remind people about the product / service or idea.
- Product Advertising: The main objective of product – advertising is to promote the sale or reputation of a particular product.
(b) Brand Promotion means informing, reminding and persuading present and potential customers to purchase a particular brand.
The methods of brand promotion are :
- Advertisements : Advertisement in newspapers, radio, TV and other media are regularly given to make a particular brand well-known among consumers.
- Quality control: Brand become popular and continue to enjoy the confidence of buyers only when the quality of the brand is maintained.
- Publicity : Publicity means any commercially significant news which has no sponsor, is non personal and is not paid for by the individuals or organisation and its products.
(c) The two suitable media to be used by the company to advertise its products are :
(i) Newspapers:
Newspapers are a popular and widely used medium of advertising. Its main advantages are : (a) Newspapers have a wide circulation. Therefore, this medium has a very wide average. (b) Due to wide coverage cost per reader is low. (c) There is continuity as the message can be repeated daily. (d) Regional newspapers can be used to focus on selected areas.
(ii) Films :
Films slides containing advertisements are shown in cinemas before the start of the feature film and during intermission. Along with the photo of the product there is a running commentary on its feature and uses. It has a wide coverage. The advertisement can be shown in selected cinema to focus on a selected region.
Question 10.
This statistic shows the global smartphone market share held by Nokia each quarter from 2007 to 2013. In the third quarter of2007, Nokia s market share was 48.7percent. By the third quarter of 2012 the company s market share had slipped to just 3.5 percent.
Nokia is a Finnish company head-quartered in Espoo, Finland. The company has a long history dating as far back as 1865 and first began developing what would later be modern mobile phone technology in the 1960s. The company has previously been a very strong competitor in the mobile phone and telecommunication market. While the company has struggled to maintain a significant share of the smartphone market, and has also recorded multiple losses in recent quarters, when it comes to feature phones, the company does maintain a relatively secure share of the market when compared to other vendors. The company also continues to perform well in the Asia-Pacific region as well as in the Middle East and Africa were they have previously recorded the greatest sales, Across the North American market however, the company has recorded very poor sales.
Previously Nokia used the operating system Symbian for its smartphones. Until 2010, Symbian was performing well in the global market but has since been overtaken by the very dominant Android system and also Apple s iOS. As of February 2011, Nokia made the announcement that they would be switching to the Microsoft Windows OS. The company was hoping to be able to make a comeback in the smartphone market with the adoption of the Windows operating system. In 2012 however, sales saw another decrease when compared to the previous 2 years. The Windows mobile operating system did not prove to be popular and market share slipped further. Even after Nokia’s high-profile acquisition by Microsoft, the market share of the brand still remains at a dismal 3 percent.
With reference to the above :
(a) Explain any five uses ofProduct Life Cycle to a business enterprise like Nokia. [5]
(b) Explain the various steps taken by Nokia after 2010 to improve the brand image. [5]
(c) What are the promotional activities that can be undertaken to increase the market share of Nokia ? [5]
Answer:
(a) Uses of Product Life Cycle to a business enterprise like Nokia.
(i) Managers are always in need of predictive tools to help them navigate a seemingly chaotic market, and the Product life cycle helps managers the ability to forecast product directions on a macro level, and plan for timely execution of relevant competitive moves.
(ii) The Product life cycle can be used as an explanatory tool in facilitating an understanding of past and future sales progression.
(iii) The Product life cycle aids in making sense of past events as part of any extrapolatory and interpretive approach to building strategy. Once a product strategy or product line strategy has been formulated, the Product life cycle can be used as part of an ongoing strategy validation process since it reflects on market trends, customer issues and technological advancement. Companies always anticipate the emergence of new competitors and therefore, must prepare in advance to battle the competition and strengthen their product’s position.
(iv) The Product life cycle is advantages in planning long¬term offensive marketing strategies, particularly when markets and economies are stable.
(v) By combining the elements of time and sales volume, the Product life cycle helps determine when reasonable to eliminate dead products.
(b) The various steps taken by Nokia after 2010 to improve the brand image.
Until 2010, Symbian was performing well in the global market but has since been overtaken by the very dominant Android system and also Apple’s iOS. As of February 2011, Nokia made the announcement that they would be switching to the Microsoft Windows OS.
The company was hoping to be able to make a comeback in the smartphone market with the adoption of the Windows operating system. In 2012 however, sales saw another decrease when compared to the previous 2 years.
(c) Promotional activities that can be undertaken to increase the market share of Nokia :
(i) Rebate:
Under it in order to clear the excess stock, products are offered at some reduced price. For example, giving a rebate by a mobile manufacturer to the tune of ? 1,000/- for a limited period of time.
(ii) Discount:
Under this method, the customers are offered products on less than the listed price. For example, giving a discount of 30% on the sale of Liberty Shoes. Similarly giving a discount of 50% + 40% by the KOUTONS.
(iii) Instant Draw and Assigned Gift :
Under this method, a customer is asked to scratch a card on the purchase of a product and the name of the product is inscribed thereupon which is immediately offered to the customer as a gift. For example, on buying a car when the card is scratched such gifts are offered – TV, Refrigerator, Computer, Mixer, Dinner Set, Wristwatch, T-shirt, Iron Press, etc.
(iv) Full Finance @ 0%:
Under this method, the product is sold and money received in installment at 0% rate of interest. The seller determines the number of installments in which the price of the product will be recovered from the customer. No interest is charged on these installments.
(v) Contests :
Some producers organise contests with a view to popularizing their products. Consumers taking part in the contest are asked to answer some very simple questions on a form and forward the same to the company. The blank form is made available to that consumer who buys the product first.
Result is declared on the basis of all the forms received by a particular date. Attractive prizes are given to the winners of the contest. Such contests can be organised in different ways.