Test: Entrepreneurial Planning- 2 - Commerce MCQ

The business organisation Pankaj is running is sole proprietorship.
The benefits of Sole Proprietorship are:
1. Sole proprietorship can be started by just 1 person.
2. The capital contribution required in Sole Proprietorship is easy lesser.
3. Sole proprietorship has direct personal contact.
4. There is direct and high degree of control in sole proprietorship.
5. Quick decision making is there in this type of business.

• Tourism Finance Corporation of India Ltd. (TFCI) is an Indian Financial Institution, set-up in 1989 upon the recommendations of the National Committee of Tourism under the aegis of Planning Commission.
• TFCI has assisted a third of the total capacity of branded hotels in India till date.
• TFCI provides all forms of financial assistance to enterprises for setting and developing travel and travel related activities, facilities and services. It also coordinates and formulates policies and strategies related to the financing of tourism projects.

Co-operative organization;
Features:

• ‘Formed an organization where in the persons voluntarily associate…..’- voluntary association, anybody can become a member of a co-operative society
• ‘managing committee that was elected in the basis of one member one vote’- democratic management, the management of the co-operative society is democratically elected.
• ‘the purpose of this organization is to help these craftsmen to find market for their products’- service motive, the main objective of a co-operative society is to provide service to it’s members and not to earn profits.

Correct Match:

A single person could not incorporate a Company previously. One Person Company (OPC) is a company incorporated by a single person. Before the enforcement of the Companies Act, 2013, a single person could not establish a company.

Unlimited liability refers to the full legal responsibility that business owners and partners assume for all business debts. This liability is not capped, and obligations can be paid through the seizure and sale of owners' personal assets, which is different than the popular limited liability business structure.

A sales tax levied on the manufacture, purchase, sale, or consumption of a specific type of commodity is known as an excise tax.  Whereas excises may be based either on quantities of the taxed product (specific excises) or on value, general sales taxes are inherently value-based taxes.

Section 30 of the Indian Partnership Act, provides that though a minor cannot be a partner in a firm, but, with the consent of all the partners for the time being, he may be admitted to the benefits of partnership by an agreement executed through his guardian with the other partners.

• A partnership agreement is a contract between partners in a partnership which sets out the terms and conditions of the relationship between the partners, including: Percentages of ownership and distribution of profits and losses.
• A partnership agreement allows partners to control how to address complex matters within the arrangement while protecting each partner's overall interests.

The marketing plan describes how the company will use the marketing mix product, promotion, place, and price to achieve its marketing objectives effectively within the competitive market environment. The marketing plan also focuses the company's resources on reaching target customers and driving them to act.

The 4 Cs of Credit helps in making the evaluation of credit risk systematic. They provide a framework within which the information could be gathered, segregated and analyzed. It binds the information collected into 4 broad categories namely Character; Capacity; Capital and Conditions.

• Production Plan: Production plan is the planning of industrial operations involves four considerations, namely, what work shall be done, how the work shall be done and lastly, when and by whom the work shall be done.
• Objectives of Production Planning and Control (PPC): Minimize production time. Improve customer satisfaction. Coordinate with departments about production, to ensure things are on the same page. Ensure the right man is assigned the right work.

• Pro forma, Latin for “as a matter of form” or “for the sake of form”, is a method of calculating financial results using certain projections or presumptions.
• Pro forma financials may not be GAAP compliant but can be issued to the public to highlight certain items for potential investors.
• They can also be used internally by management for aiding in business decisions.
• It's illegal for publicly traded companies to mislead investors with pro forma financial results that do not use the most conservative possible estimates of revenue and expense.
   

A business plan is a very important and strategic tool for entrepreneurs. A good business plan not only helps entrepreneurs focus on the specific steps necessary for them to make business ideas succeed, but it also helps them to achieve short-term and long-term objectives.