Please refer to Class 12 Business Studies Sample Paper Term 2 With Solutions Set A below. These Class 12 Business Studies Sample Papers will help you to get more understanding of the type of questions expected in the upcoming exams. All sample guess papers for Business Studies Class 12 have been designed as per the latest examination pattern issued by CBSE. Please practice all Term 2 CBSE Sample Papers for Business Studies in Standard 12.
Sample Paper Term 2 Class 12 Business Studies With Solutions Set A
1. Mention two techniques of estimating manpower requirement.
Answer : 1. Workload analysis
2. Workforce analysis
2. Charu is a chartered accountant in Prakash Ltd. During the course of meeting with directors she came to know that as against the previous years, this year company is going to declare handsome dividend offer. It is observed that when such news becomes public then the share market jumps up. Considering it, Charu purchased large number of company’s shares before this news reached the public.
1. Identify the type of malpractice used by Charu.
2. Name the authority which regulates such behaviour.
Answer : 1. Price rigging.
2. Authority is securities and exchange board of India (SEBI).
3. Babita Ltd. is engaged in manufacturing machine components. The target production is 250 units per day per worker. The company had been successfully attaining this target until two months ago. Over the last two months it has been observed that daily production varies between 200-210 units per worker.
Name the function of management and identify the step in the process of this function which helped in finding out that the actual production of a worker is less than the set target.
Answer : The management function is controlling.
“comparing actual performance with standards” is the step involved in the process of controlling which helped in finding out that the actual production of a worker is less than the set target.
4. Name the methods of recruitment in the following cases:
1. A company gets applications on and off even without declaring any vacancy. However, as and when the vacancy arises, the company makes use of such applications.
2. Casual vacancies of unskilled or semi-skilled jobs when there is a rush of order or when some permanent workers are absent.
Answer : 1. Casual callers
2. Direct recruitment
5. To satisfy the social and physiological needs which type of incentives are needed?
Explain any two types of such incentives.
Answer : Financial incentives are needed to satisfy the social and physiological needs.
These types of such incentives are
I. Pay and allowances: salary is the basic monetary incentive for every employee. It Includes basic pay, dearness allowance and other allowances like house rent Allowance, entertainment allowance etc. Under salary system, employees get Regular annual increments and enhancement of allowances from time to time.
II. Profit sharing: sometimes a company or a business firm may share some part of Its profit with the employees. The main purpose of sharing profits with the Employees is to improve their performance so that they can contribute more in Increasing the productivity and profits of the firm.
III. Productivity linked wage incentives: employees can be motivated by giving Them productivity linked wage incentives. There are certain wage rate plans Which offer higher wage for more efficient worker for example; different piece Wage system allows high wages to efficient workers as compared to inefficient Workers.
IV. Co-partnership/stock option: sometimes companies offer their shares to its Employees at a set price which is lower than the market price. The main purpose of allotting shares to the employees is to create a feeling of ownership among them So that they can contribute more for the growth of the organization.
6. Differentiate between formal communication and informal communication on the basis of: Channel, Nature and speed.
State the meaning of different types of Leadership styles
Answer : Autocratic leadership style: This style is also known as leader cantered style. The leader keeps all the authority and employees have to perform the work exactly as per his order. He does not decentralize his authority. The responsibility of the success or the failure of the management remains with the manager.
Democratic leadership: This style is also known as group cantered leadership style. Managerial decisions are not taken by the manager in consultation with employees. This leadership style is based on decentralization. Managers respect the suggestions made by his sub ordinates.
Laissez-faire leadership style: this style as leadership is also known as free brain leadership or individual cantered style. The manger takes little interest in managerial functions and the sub ordinates are left on their own. Manager explain over all objectives; help sub- ordinates in determining their own objectives. They provide resources. They also advise the employees.
7. Name the process which helps in estimating the future finance requirements of an organisation. Also, give two importance of that process.
Answer : Financial planning is the process of estimating the future Finance requirements of an organisation.
Importance of financial planning are
(i) by forecasting what may happen in future, company Prepares plans for future through financial planning.
(ii) it helps in avoiding business shocks and surprises by Preparing a blueprint of organisation’s future Preparations.
(iii) financial planning helps in linking the present with the future.
(iv) through financial planning, wastage of human as Well as physical resources is reduced.
8. D & D Ltd. is a large manufacturing unit. Recently, the company has conducted the ‘time’ and ‘motion’ studies and concluded that on an average a worker could produce 120 units per day. However, it has been noticed that average daily production of a worker is in the range of 80-90 units.
Which function of management is needed to ensure that the actual performance is in accordance with the performance as per ‘time’ and ‘motion ‘studies? State four features of this function of management
Answer : Controlling
Features of controlling:
1. Controlling is a goal-oriented function
2. Controlling is a pervasive function
3. Controlling is a continuous process
4. Controlling is both a backward looking as well as forward looking function.
9. Nishant, the director of a garments company, is planning to manufacture bags for the utilisation of waste material from one of his garment’s units. He has decided that this manufacturing unit will be set up in a rural area of Odisha where people have very few job opportunities and labour is available at very low rates. He has also thought of giving equal opportunities to men and women. For this, he wants four different heads for Sales, Accounts, Purchase and Production. He gives an advertisement and shortlists ten candidates per post after conducting different selection tests.
(i) Identify and state the next five steps for choosing the best candidate out of the candidates shortlisted.
Answer : Next five steps in selection are:
(i) employment interview
(ii) checking references and background
(iii) selection decision
(iv) medical examination
(v) job offer
10. Under consumer protection, who can file a complaint?
Answer : A complaint before the appropriate consumer forum can be made by:
(i) any consumer can file a complaint on his/her own and does not need the services of advocate/ professionals
(ii) any registered consumers’ association;
(iii) the central government or any state government;
(iv) one or more consumers, on behalf of numerous consumers having the same interest
(v) a legal heir or representative of a deceased consumer.
What are the Remedies/Reliefs available to the consumer under Consumer Protection Act?
Answer : If the consumer court is satisfied about the genuineness of the complaint, it can issue one or more of the following directions to the opposite party.
(i) to remove the defect in goods or deficiency in service.
(ii) to replace the defective product with a new one, free from any defect.
(iii) to refund the price paid for the product, or the charges paid for the service.
(iv) to pay a reasonable amount of compensation for any loss or injury suffered by the consumer due to the negligence of the opposite party.
(v) to pay punitive damages in appropriate circumstances.
(vi) to discontinue the unfair/restrictive trade practice and not to repeat it in the future.
(vii) not to offer hazardous goods for sale.
(viii) to withdraw the hazardous goods from sale.
(ix) to cease manufacture of hazardous goods and to desist from offering hazardous services.
(x) to pay any amount (not less than 5% of the value of the defective goods or deficient services provided), to be credited to the consumer welfare fund or any other organisation/person, to be utilised in the prescribed manner.
(xi) to issue corrective advertisement to neutralise the effect of a misleading advertisement.
(xii) to pay adequate costs to the appropriate party.
11. Distinguish between money market and capital market.
Answer : Difference between money and capital market (any 5)
12. ‘G Motors’ is the manufacturer of sophisticated cranes. The production manager of the company, reported to the chief executive officer, Ashish Jain that one of the machines used in manufacturing
sophisticated cranes had to be replaced to compete in the market, as other competitors were using automatic machines for manufacturing cranes. After a detailed analysis, it was decided to purchase a new automatic machine having the latest technology. It was also decided to finance this machine through long-term sources of finance.
Ashish Jain compared various machines and decided to invest in the machine which would yield the maximum returns to its investors.
(i) Identify the financial decision taken by Ashish Jain.
(ii) Explain any three factors affecting the decision identified in (i) above.
Answer : (i) financial decision taken by Ashish Jain is investment (longterm/capital budgeting) decision.
(ii) the factors affecting investment decision are given Below
(a) cash flow of the project when a firm takes an Investment decision involving huge amount, it Expects to generate some cash flows (inflow or Outflow) over a period.
Thus, the inflows and outflows of cash in the Business should be considered before making Capital budgeting decisions.
(b) rate of return each project is selected after Comparing expected returns of different projects and the degree of risk involved in them.
(c) the investment criteria involved the decision to Invest in a particular project involves a number of Calculations regarding the amount of investment, Interest rate, cash flows and rate of return.
Sana is a young professional employed in a multinational company. Her annual package is of `6 lakh. Since she lives with her parents, therefore she is able to save a major part of her earnings. Her friends are constantly advising her to invest in shares. But, she is not aware about the nitty-gritties regarding the functioning of the stock-exchange.
So, she decided to invest in equity through the primary market, assuming that this will help her to earn stable dividends. But her father, who was a retired bank officer told her that even dividends are
not stable as they are affected by several factors.
(i) Is Sana’s father right in his assertion?
(ii) Explain the following as factors affecting ‘dividend decision’.
Answer : (i) yes, Sana’s father is correct in his assertion.
(ii) factors affecting dividend decision are
(a) stability of dividend every company adopts the Policy of maintaining the stability of dividend per Share. From this point of view, a little change in Profit should not be allowed to increase or Decrease the dividend.
(b) legal constraints certain provisions of the Companies act put restrictions on pay-outs as Dividend. Such provisions must be adhered to While declaring the dividend.
(c) access to capital market large and reputed Companies generally have easy access to the Capital market and therefore may be depended Less on retained earnings to finance their growth. These companies tend to pay higher dividends Than the smaller companies.
4. Growth opportunities companies having good Growth opportunities retain more money out of their Earnings so as to finance the required investment. Therefore, the dividend declared in growth companies Is smaller than that in the non-growth companies.
5. Cash flow position dividend involves an outflow of Cash. Availability of enough cash is necessary for Payment or declaration of dividends.
6. Shareholders’ preference while declaring dividends, Management must keep in mind the preferences of the Shareholders. Some shareholders desire that at least a Certain amount is paid as dividend.
7. Taxation policy if the tax on dividends is higher, it is Better to pay less by way of dividends. But if the tax rates are lower, higher dividends may be Declared. This is because as per the current taxation Policy, a dividend distribution tax is levied on Companies.
8. Stock market reaction generally, an increase in Dividends has a positive impact on stock market and Vice-versa. Thus, while deciding on dividends, this Should be kept in mind.
9. Access to capital market large and reputed Companies generally have easy access to the capital Market and therefore, may depend less on retained Earnings to finance their growth. These companies Tend to pay higher dividends than the smaller Companies.