B Com Exam > B Com Questions > Out of the following,which system is more sui...
Start Learning for Free
Out of the following,which system is more suitable from the seller's point of view and why (1) Hire purchase syetem (2) Instalment Payment system?
Most Upvoted Answer
Out of the following,which system is more suitable from the seller's p...
Hire Purchase System vs Instalment Payment System: Which is More Suitable from Seller's Point of View?
Introduction: Both Hire Purchase System and Instalment Payment System are popular payment methods used by sellers to sell their products to customers. However, from the seller's point of view, one system may be more suitable than the other. In this article, we will compare both systems and determine which one is more suitable for sellers.
What is Hire Purchase System?
Under Hire Purchase System, the seller allows the buyer to use the product while paying for it in instalments. The seller retains ownership of the product until the buyer makes the final payment.
What is Instalment Payment System?
Under Instalment Payment System, the seller allows the buyer to pay for the product in instalments while using it. The seller transfers ownership of the product to the buyer after the first instalment is paid.
Advantages of Hire Purchase System for Sellers:
Disadvantages of Hire Purchase System for Sellers:
Advantages of Instalment Payment System for Sellers:
Disadvantages of Instalment Payment System for Sellers:
Conclusion: From the above comparison, it is clear that Hire Purchase System is more suitable from the seller's point of view as it offers higher profit and guaranteed payment. However, the seller should also consider the higher risk and potential lower sales. The Instalment Payment System may be more suitable for sellers who are willing to take a lower profit for higher sales and lower risk.
Introduction: Both Hire Purchase System and Instalment Payment System are popular payment methods used by sellers to sell their products to customers. However, from the seller's point of view, one system may be more suitable than the other. In this article, we will compare both systems and determine which one is more suitable for sellers.
What is Hire Purchase System?
Under Hire Purchase System, the seller allows the buyer to use the product while paying for it in instalments. The seller retains ownership of the product until the buyer makes the final payment.
What is Instalment Payment System?
Under Instalment Payment System, the seller allows the buyer to pay for the product in instalments while using it. The seller transfers ownership of the product to the buyer after the first instalment is paid.
Advantages of Hire Purchase System for Sellers:
- Higher Profit: The seller can charge a higher price for the product under Hire Purchase System as the buyer is paying in instalments.
- Guaranteed Payment: The seller has the right to repossess the product if the buyer defaults on payment, ensuring guaranteed payment.
- Tax Benefits: The seller can claim tax benefits on the interest charged on the instalments.
Disadvantages of Hire Purchase System for Sellers:
- Higher Risk: The seller is at a higher risk of non-payment as ownership of the product remains with the seller until the final payment is made.
- Lower Sales: The higher price of the product may result in lower sales as customers may opt for cheaper alternatives.
Advantages of Instalment Payment System for Sellers:
- Higher Sales: The lower price of the product may result in higher sales as customers may opt for this payment method.
- Lower Risk: The seller is at a lower risk of non-payment as ownership of the product is transferred to the buyer after the first instalment is paid.
Disadvantages of Instalment Payment System for Sellers:
- Lower Profit: The seller may charge a lower price for the product under Instalment Payment System as the buyer is paying in instalments.
- No Guaranteed Payment: The seller has no right to repossess the product if the buyer defaults on payment, resulting in no guaranteed payment.
Conclusion: From the above comparison, it is clear that Hire Purchase System is more suitable from the seller's point of view as it offers higher profit and guaranteed payment. However, the seller should also consider the higher risk and potential lower sales. The Instalment Payment System may be more suitable for sellers who are willing to take a lower profit for higher sales and lower risk.
Community Answer
Out of the following,which system is more suitable from the seller's p...
Hire purchase system is better for seller because the ownership remains in the hands of seller
|
Explore Courses for B Com exam
|
|
Similar B Com Doubts
Out of the following,which system is more suitable from the seller's point of view and why (1) Hire purchase syetem (2) Instalment Payment system?
Question Description
Out of the following,which system is more suitable from the seller's point of view and why (1) Hire purchase syetem (2) Instalment Payment system? for B Com 2024 is part of B Com preparation. The Question and answers have been prepared according to the B Com exam syllabus. Information about Out of the following,which system is more suitable from the seller's point of view and why (1) Hire purchase syetem (2) Instalment Payment system? covers all topics & solutions for B Com 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Out of the following,which system is more suitable from the seller's point of view and why (1) Hire purchase syetem (2) Instalment Payment system?.
Out of the following,which system is more suitable from the seller's point of view and why (1) Hire purchase syetem (2) Instalment Payment system? for B Com 2024 is part of B Com preparation. The Question and answers have been prepared according to the B Com exam syllabus. Information about Out of the following,which system is more suitable from the seller's point of view and why (1) Hire purchase syetem (2) Instalment Payment system? covers all topics & solutions for B Com 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Out of the following,which system is more suitable from the seller's point of view and why (1) Hire purchase syetem (2) Instalment Payment system?.
Solutions for Out of the following,which system is more suitable from the seller's point of view and why (1) Hire purchase syetem (2) Instalment Payment system? in English & in Hindi are available as part of our courses for B Com.
Download more important topics, notes, lectures and mock test series for B Com Exam by signing up for free.
Here you can find the meaning of Out of the following,which system is more suitable from the seller's point of view and why (1) Hire purchase syetem (2) Instalment Payment system? defined & explained in the simplest way possible. Besides giving the explanation of
Out of the following,which system is more suitable from the seller's point of view and why (1) Hire purchase syetem (2) Instalment Payment system?, a detailed solution for Out of the following,which system is more suitable from the seller's point of view and why (1) Hire purchase syetem (2) Instalment Payment system? has been provided alongside types of Out of the following,which system is more suitable from the seller's point of view and why (1) Hire purchase syetem (2) Instalment Payment system? theory, EduRev gives you an
ample number of questions to practice Out of the following,which system is more suitable from the seller's point of view and why (1) Hire purchase syetem (2) Instalment Payment system? tests, examples and also practice B Com tests.
|
|
Explore Courses for B Com exam
|
|
Suggested Free Tests
Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
|
© EduRev
|
Education Revolution
|
Follow Us
|
Signup to see your scores
go up within 7 days!
Access 1000+ FREE Docs, Videos and Tests
Takes less than 10 seconds to signup