JAMB Commerce Past Questions & Answers - Page 35

171.

When expenses on trading are deducted, the result is the

A.

rate of turn over

B.

net profit

C.

gross profit

D.

cost of goods sold

Correct answer is B

Net profit is the actual profit after working expenses not included in the calculation of gross profit have been paid/deducted.

172.

In the transportation industry, dead freight is used to describe the

A.

cost paid for an empty space left in the ship

B.

charge for each day a performance was delayed

C.

persons that hire a ship for a specific purpose

D.

cost of shipping a particular cargo for a specific voyage

Correct answer is A

Dead freight is the amount paid by or recoverable from a charterer of a ship for such part of the ship's capacity as the charterer has contracted for but fails to occupy also.  it is simply payment for  the unoccupied space in chartered  ship.

173.

The pricing policy that seeks to set prices relatively high in order to attract the wealthy segment of the market is

A.

target return pricing

B.

market skimming

C.

variable pricing

D.

market penetration

Correct answer is B

Market Skimming Pricing. a pricing approach in which the producer sets a high introductory price to attract buyers with a strong desire for the product and the resources to buy it, and then gradually reduces the price to attract the next and subsequent layers of the market.

174.

A formal letter to a dealer to enquire details about certain items for sale is referred to as

A.

an inquiry

B.

an invoice

C.

an order

D.

a quotation

Correct answer is A

quotation is a document that offers goods or services at a stated price, under specified conditions: it allows a customer to see details before confirming.

175.

Funds used for paying wages, salaries and payments for raw materials are categorized under

A.

liquid capital

B.

circulating capital

C.

fixed capital

D.

nominal capital

Correct answer is B

Circulating capital includes intermediate goods and operating expenses, i.e., short-lived items that are used in production and used up in the process of creating other goods or services. e.g Raw materials, work in process, finished goods, and cash at hand that continually flow within an organization.