Advantages of a joint stock company are:
(i) Large capital:
A company can secure large capital compared to a sale trader or partnership. Large amount of capital is necessary for conducting business on a large scale. For ego Reliance has invested more than Rs.25,000 crore in its telecom venture. Raising such huge amount of funds would be utter impossible in a soletradership or partnership.
(ii) Limited liability:
The liability of a shareholder is limited. In 'the case of a company limited by guarantee, his liability is restricted to the amount that he has guaranteed to contribute in the event of winding up of the company.
(iii) Transferability of shares:
Transaction of Shares between two individuals is easy. So there is liquidity of investment. Any shareholder can easily convert his shares into money by selling his shares.
(iv) Perpetual succession:
A company has perpetual or continuous existence. Members may go or new members may come in, but the company continues to exist. This ensures continuity in operations and the company can undertake long term investments.
(v) Promotion of saving and investment habit:
Joint stock company system encourages people to save. Even small amount can be used for the purchase of shares. A person can buy even one share of a company.
(vi) Risk Bearing capacity:
The loss of the company is distributed over a large number of shareholders. So each shareholder bears a very little amount of loss. Hence the company form of organisation has risk bearing capacity.
(vii) Economies of Large-scale Operation:
A joint stock company can undertake business on large scale. As a result it can derive all the advantages of large scale production. For e.g. Hero Moto Corp Ltd. 2015, the world's largest seller of twowheelers, manufactures motorbikes on a large scale and is able to enjoy cost efficiency.
(viii) Economic Development:
Joint stock company system has been responsible for the rapid growth of industries and trade in many countries. Since Joint Stock Companies have large financial resources, they are able to undertake large scale production, satisfy the needs of more number of consumers, create large scale employment opportunities, promote balanced regional development and contribute substantially to the government by way of taxes.

Formation of a co-operative society:
It must be registered under the co-operative societies Act 1912 or any other state co-operative law.
A co-operative society can be started with a minimum of 25 persons, having a common interest. An application has to be submitted to the Registrar of co-operative societies expressing their intention.
The application form is known as 'Memorandum of Association'. It should contain the name and address of the society its objectives, the capital and liability of the members. A copy of the bye-laws slating the rules and regulations of the society should be attached along with the application form.
The system of management procedure with regard to meetings resolutions are stated in the bye-laws. The Registrar will carefully scrutinise the documents in order to ensure that they are in accordance with the provisions of the Act. When he is fully satisfied he will enter the name of the society in his register and issue the 'Certificate of Registration'. By issue of this certificate the society comes into existence as a body corporate having a separate legal entity.

The advantages of Government Company are:
Easy formation:
A Government company can be easily formed under the Companies Act, just by an executive decision of the government.
Internal autonomy:
A government company can manage its affairs independently. It is relatively free from ministerial control and political interference, in its day-to-day functioning.
Private participation:
Through Government company device, the government can avail of the management skills, technical know how and expertise of the private sector and foreign countries. For example, the Hindustan Steel Limited has obtained technical and financial assistance from the U.S.S.R., West Germany and the U.K.for its steel plants at Bhilai, Rourkela and Durgapur.
Easy to alter:
Objectives and powers of the Government company can be changed by simply altering the Memorandum of Association of the company, without seeking the approval of the Parliament.
Discipline:
The Government company is subject to provisions of the Companies Act; which keeps the management of the company active, alert and disciplined.
Professional management:
A Government company can employ professionally qualified managers; because it has its own personnel policies.
Public accountability:
The Annual Report of a Government company is presented to the Parliament/State Legislature. These reports can be discussed and debated there.

One-man control is the best in the world:
William R. Basset has said that one-man control is the best in the world only when the business is small indeed, to allow one actually to know and supervise everything in the business.
Following are some of the points in favour of one-man control:
(i) Easy and quick formation,
(ii) Direct control,
(iii) Efforts and reward are linked,
(iv) Retaining business secrets,
(v) Close touch with the consumers,
(vi) Enjoying all profits,
(vii) Inexpensive management,
(viii) No legal restrictions,
(ix) Direct contact with the employees and
(x) Social desirability.
Limitations of one-man control:
Though there are many advantages of one-man control, still it suffers from many drawbacks. One man is unable to manage all the affairs by himself. Basset says, "The danger is always present that he thinks, he knows which really he does not know".
Following are some points unfavourable for one-man control:
(i) Limited capital,
(ii) Limited managerial ability,
(iii) Unlimited liability,
(iv) Absence of large-scale business operation,
(v) Risky decisions and
(vi) Uncertainty.
In conclusion, one-man control is the best from the point of view of profitability and efficiency,provided that one man is big enough to manage everything efficiently.

First step we ask his registered phone number in the bank. If he has given phone number, we can get one-time password through the registered phone number and get new password easily. Second step, he can get the password with the mobile in the ATM also. He has to insert the debit card in ATM machine. It will ask the password. If he has forgotten the password, it will ask the phone number. If he types the phone number, he can get new password from the bank through his mobile number.
Third step: He can ask the branch manager, who will guide him properly and help him get the new password.

1. Roman and Greek traders frequented the ancient Tamil country and forged trade relationship with ancient Kings of Pandiya, Chola and Chera dynasties.
2. Cholas had a strong trading relationship with Chinese Song Dynasty.
3. The Cholas conquered the Sri Vijaya Empire of Indonesia and Malaysia to secure a sea trading route to China. During the 16th and 18th centuries, India's overseas trade expanded due to trading with European companies.
4. The discovery of new allsea routes from Europe to India via Cape of Good Hope by Vasco da Gama had far-reaching impact on the civilized world.
5. The arrival of Portuguese in India was followed by the advent of other European communities.
6. They gained a strong foothold in India's maritime trade by virtue of their strong naval power. 

1. Railways are well suited for carrying heavy and bulky goods over long distances.
2. It can provide long distance travel throughout the day and night with unbroken services.
3. It can provide better production and safety to the goods than motor transport. The goods generally carried in closed wagons are not exposed to sun, rain etc.
4. Though initial investment is large, in the long run the operating expenses will be very low in railways and it will prove a cheaper mode of transport. It requires less time than motor transport for carrying goods over long distance with greater speed.
5. It has regular schedule of timing and is available throughout the year. 
6. It provides unaffected services whether rainy or shinny weather conditions.

Payment Banks are formed to widen the spread of payment and financial services to small businesses,low-income households, and migrant labourers These banks should be fully networked from the beginning. They offer doorstep banking payment for a small fess prescribed on the basis of amount.They issue ATM/Debit cards, Internet banking and third party fund transfers.But they can't lend money and issue credit cards.In August 2015, the RBI gave 'in principle' licenses to Payment Banks.

The following are the Functions of CWC:
1. To provide agency services for scientific storage of agricultural produce, seeds, manures fertilizers, agricultural implements and other notified commodities.
2. To issue a negotiable warehouse receipt for procuring credit to the owners of goods.
3. To preserve the produce deposited with care and protect against insects and various pests and deterioration due to moisture and dampness.
4. To act as an agent of the government for the purchase and sale, storage, and distribution of specified commodities and transport to and from warehouse.
5. To reduce the cost of storage and facilitate the marketing of produce through proper grading.

Dissolution of partnership means the termination of the original partnership agreement. A partnership is dissolved by the insolvency, retirement, expiry or completion of the term of partnership. The business will continue after dissolution of partnership. It takes in the following forms:
Change in the existing profit sharing ratio
1. Admission of a partner.
2.Retirement or Death of a partner.
3. Insolvency of a partner.
4. Expiry of the term of the partnership.
5. Completion of the specified venture.
6. Dissolution by agreement.

The industries which produces utility services and sell them at the profit.These industries help trade,commerce and industry.The auxiliaries to trade like banking, insurance,warehouse,advertisement etc are included in this.These industries are further classified as under:
1) Personalized service:
The individuals and private institutions selling their services to others are called as personalized services.E.g Plumber, servant maid etc.
2) Public service:
The government provide services to the people without profit motive through Government Hospital,schools, police, Government offices etc.
3) Distributive service:
Transportation, sales, warehousing, logistics, salesmanship etc. come under this type of service.
4) Financial service:
Banking; factoring, accounting and insurance etc.are grouped under this type of service.
5) Quaternary service:
Professional or specialized skills and high technology are used to provide this type of service. Eg.Software development, Auditing, Research and Development, etc.
6) Quinary service:
Selective individual experts create new ideas, implement new technologies and implement new policies. These decisions influenced the growth and development of national and international institutions.

i. Danger for Domestic Industries:
MNCs, because of their vast economics power, pose a danger to ho domestic industries; which are still in the process of development. Domestic industries cannot face challenges posed by MNCs. Many domestic industries have to wind up, as a result of threat from MNCs. Thus MNCs give a setback to the economic growth of host countries.
ii. Transfer of Outdated Technology:
Where MNCs transfer outdated technology to host nation, it serves, no purpose.
iii. No Benefit to Poor People:
MNCs produce only those things, which are used by the rich, Therfore, poor people of host countries do not get, generally, any benefit, out of MNCs.
iv. Danger to Independence :
Intially MNCs help the Government of the host country, in a number of ways; and then gradually start interferring in the political affairs of the host country. There is, then, an implicit danger to the independence of the host country, in the long - run.
v. Deprivation of Job Opportunity of Local People:
MNCs may not generate job opportunities to the people of home country.
vi. Misuses of Mighty Status:
MNCs are powerful economic entities. They can afford to bear losses for a long while, in the hope of earning huge profits once they have ended local competiton and achieved monopoly. This may be the dirty marketing strategy of MNCs to wipe off local competitors from the host country.
vii. Careless Exploitation of Natural Resources:
MNCs tend to use the natural resources of the host country carelessly. They cause rapid depletion of some of the non-renewable natrual resources of the host country. In this way, MNCs cause a permanent damage to the economic development of the host country.
viii. Selfish promotion of Alien Culture:
MNCs tend to promote alien culture in host country to sell their products. They make people forget about their own cultural heritage. In India, e.g. MNCs have created a taste for synthetic food, soft drinks etc. This promotion of foreign culture by MNCs is injurious to the health of people also.
ix. Neglect of Industrial and Economic Growth of Home Country:
An investment in host countries is more profitable, MNCs may neglect home countries industrial and economic development.

Contents of Memorandum of Association:
Name Clause:
i. The name clause requires to state the legal and recognized name of the company.
ii. The company name is allowed to be registered if it does not bear any similarities with the name of an existing company, companies only.
Situation Clause:
i. The registered office clause requires to show the physical location of the registered office of the company.
ii. It is required to keep all the company registers in this office.
iii. The registered office should be established prior to commencing business activities.
Objective Clause:
i. The objective clause requires to summarize the main objectives for establishing the company with reference to the requirements for shareholding and use of financial resources.
ii. It is required to state the ancillary objectives; that is, those objectives that are required to facilitate the achievement of the main objectives.
iii. The objectives should be free of any provisions or declarations that contravene laws or public good.
Liability Clause:
i. The liability cláuse requires to state the extent to which shareholders of the company are liable to the debt obligations of the company in the event of the company dissolving.
ii. There are companies limited by shares and limited by guarantee.
Capital Clause:
i. The capital clause requires to state the company's authorized share capital, the different categories of shares and the nominal value (the minimum value per share) of the shares.
ii. It is also required to list the company's assets under this clause.
Association Clause:
i. The association clause confirms that shareholders bound by the MOA are willingly associating and forming a company.
ii. It requires seven members to sign an MOA for a public company and not less than two people for a MOA of a private company.
iii. The signing must be done in the presence of witness who must also append his signature.

1. India ranks 10th in the world in Factory output.
2. The manufacturing sector Accounts for 27.6% GDP.
3. Privatisation of certain Public sector Industries.
4. Liberalisation also attracted MNC's and encouraged local entrepreneurs.
5. India stands 15th in service output. Increased demand from Foreign consumers for Indian products and services.
6. India has an extensive network undersea fiber-optic cables leading to India becoming the centre for outsourcing of Business process.
7. India has become big employment generator, especially amongst young graduates.
8. India has witnessed sustained Economic development as envisioned by our forefathers.
Top MNC's in India : 
Following are the names of some of the most famous multinational companies:
1. IBM,
2. Microsoft
3. Pepsico
4. Sony
5. Vodafone
6. Reebok
7. Nokia.
The entry of MNC's into India have proved quite beneficial for the growth and development of Indian Economy providing Employment opportunities for the young generation.

Definition :
MSME is a sector that empowers entrepreneur's which provide employment opportunities to the people of India. It is classified into two classes.
1. Manufacturing Enterprises:
They refer to the enterprises engaged in the manufacturing or production of goods pertaining to any industry specified in the first schedule to the Industries (Development and Regulation) Act, 1951. The manufacturing enterprises are defined in the terms of investment in plant and machinery.
2. Service Enterprises:
They refer to the enterprises engaged in providing or rendering of services. The limit of investment in plant and machinery/equipment for manufacturing/Service Enterprises is notified as under.

Enterprise	Manufacturing sector	Service sector
	(The limit for investment in plant & machinery)	(The limit for investment in Equipments)
Micro enterprises	Does not exceed Rs. 25 lakhs	Does not exceed Rs.10 lakhs
Small enterprises	More than Rs.25 lakhs but not exceeding Rs.5 crores.	More than Rs.10 lakhs but not exceeding Rs.2 crores.
Medium enterprise	More than 5 Crores but not exceeding Rs.10 crores	More than Rs.2 crores but not exceeding Rs.5 crores

Types of Foreign Trade :
A. Import Trade:
Import trade means buying goods from a foreign country for domestic use.
Example:
1. India imports petroleum products from Gulf Countries.
2. India imports machinery, equipment, materials, etc.
3. It is necessary to speed-up industrialization, to meet consumer demands and to improve standard of living.
B. Export Trade:
Export trade means the sale of domestic goods to foreign countries.
Examples:
1. Export of Iron ore from India to Japan.
2. Selling of Tea from India to England.
3. Export of jasmine flowers from Madurai to Singapore.
Export trade is necessary to sell domestic surplus goods, to make better utilization of resources, to earn foreign exchange, to increase national income, to generate employment and to increase Government revenue.
India's important export and import items:

S.No	Export items	Import items
1	Petroleum products	Minerals, fuels including oil
2	Jewellery	Gem, Precious metals
3	Automobile	Electrical Machinery and Equipments
4	Bio-chemicals	Machinery including computers
5	Pharmaceuticals	Organic chemicals

C. Entrepot Trade:
Entrepot trade means importing of goods from one country and exporting the same to foreign countries. It is also known as 'Re-export trade'. E.g. Indian diamond merchants in Surat import uncut raw diamonds from South Africa, they cut and polish the diamonds in their units in India and re-export them to the International Diamond Market in Amsterdam.

Disadvantages:
(i) Economic dependence:
(1) International Trade is more likely to make the country too much dependent on imports from foreign countries.
(2) The former may not take any efforts to produce goods and services indigenously to substitute imported goods and becoming self sufficient.
(3) As a result, the importing country may become economically slave to exporting country and end up becoming colony of exporting country.
(ii) Inhibition of growth of home countries:
(1) International business may discourage the growth of indigenous industries.
(2) Unrestricted imports and severe competition from foreign companies may ruin the home industries altogether.
iii) Import of Harmful Goods:
International business may lead to import of luxurious goods, spurious goods, dangerous goods, etc. It may harm the well-being of people.
(iv) Shortage of essential goods in home country:
Moreover, the export of essential commodities out of the greed of earning more foreign exchange may result in an absolute shortage of these goods at home country and people may have to buy these commodities at an exorbitant price in the local market
(v) Misuse of natural resources:
(1) Excessive export of scarce natural resources to various countries across the world may lead to faster depletion of the resources.
(2) This in turn may bring about ecological disaster in the country from which it is exported.
(vi) Political exploitation:
(1) International business may create economic dependence among the countries which may threaten their political independence.
(2) The MNC s may influence the policy decision of the government to their favour.
(3) In due course of time they may dictate terms to administrators of nation by the strength of their money power.
(4) For Example Britishers came to many countries as mere traders and ultimately colonized those countries and ruled them for centuries.
(vii) Rivalry among the nations:
(1) Acute competition for exports may lead to rivalry among the nations.
(2) This may lead to conflict of interest among the countries, and end up in wars among them.
(viii) Invasion of culture:
(1) International business may result in invasion of country's culture.
(2) Younger generation is more likely to imitate foreign culture and buy goods and services beyond their means to gain acceptance in the affluent section of society.
(3) This will ruin the conventional life style of the society.

(i) Costly and difficult to form:
(1) Number of legal formalities must be observed in the formation of the company.
(2) To observe these legal formalities,promoters have to spend much time and money.
(ii) Scope for dishonest and unscrupulous management:
(1) The directors manage the company with the help of paid officers.
(2) If the directors are dishonest,they may make the personal gain at the expense of the company.
(iii) Management oligarchy:
(1) A few rich persons may secure control over the affairs of the company.
(2) Thus, the management of a joint stock company might become oligarchic in character.
(iv) Speculation:
A few individuals may corner the shares to gain control over the company.
(v) Lack of interest:
(1) The officers of the company do not have the incentive to work hard.
(2) They are not usually' inclined to take risks. They lack initiative.
(vi) Lack of good labour relations:
(1) In sole trading business personal supervision is possible.
(2) But in company form of organization, there is lack of personal contact between owners and workers.
(vii) High taxation: 
Joint stock companies have to pay tax at higher rates compared to other forms of organizations

GST of three kinds :
(i) CGST
(ii) SGST
(iii) UGST
(iv) IGST
a) CGST
Central Goods and Services Tax imposed and collected by Central Government on all supply of goods within the State (intrastate) under CGST ACT 2017.
b) SGST 
State Goods and Services Tax imposed and collected by the State Governments under State GST Act. (Tamil Nadu GST Act 2017 passed by Tamil Nadu Government)
c) UGST
Union Territory Goods and Services Tax - imposed and collected by five Union Territory Administrations in India under UGST Act, 2017.
d) IGST 
1. Inter-State Goods and Services Tax - imposed and collected by the Central Government and the revenue shared with states under IGST Act 2017.
2. IGST On exports - All exports are treated as inter-state supply under GST.
3. Since exports are zero-rated. GST is not imposed on all goods and services exported from India.
4. Any input credit is paid already on exports will be refunded.

PRIMARY FUNCTIONS:
The primary functions of a commercial bank are of three types. They are:
i. Accepting Deposits
ii. Granting Loans and Advances
iii. Creation of Credit
1. Accepting Deposits:
The basic deposit accounts offered by commercial banks are listed below. In these days banks compete with each other to attract customers by adding facilities to these deposit accounts. Broadly deposit accounts can be classified into demand deposits and time deposits.
A.Demand Deposits :
These deposits are repayable on demand on any day. This consists of savings deposits and current deposits.
a) Savings Deposits:
General public deposit their savings into this account. This account can be opened in one individual's name or more than one name. Section 25 companies also can open savings accounts. Whereas Business firms are not permitted to open savings account.
b) Current Deposits:
This account is suitable for business institutions. Individuals too can open this account. A higher minimum balance should be kept in this account. If not penal interest is charged. No interest is paid for the balance in this account.
B.Time Deposits:
They include fixed deposits and recurring deposits which are repayable after a period.
a) Fixed Deposits (FD):
Certain amount is deposited for a fixed period for a fixed rate of interest. FDR (fixed deposit receipt) is given to the depositor. Rate of interest is higher than savings account. On the date of maturity the principal along with interest for the fixed period is paid. A customer can obtain loan by depositing FDR.
b) Recurring Deposits (RD):
Certain sum is deposited into the account every month for one year or five years or the agreed period. Interest rate is more than savings deposits and almost equal to fixed deposits. At the end of the period the deposited amounts along with interest are returned to the customer.
2. Granting Loans and Advances:
The second primary function of commercial banks is lending money in order to earn interest income. Banks provide specific sums as loans which are repayable along with interest. Demand loans should be repaid whenever demanded. Term loans can be repaid after the agreed period. Advances are credit facilities provided for short period (within a year) to business community. But both terms are used interchangeably.
A. Advances:
a) Overdraft:
It is a credit facility extended mostly to current account holding business community customers. It is an arrangement reached between the banker and the credit worthy customers.
b) Cash Credit:
It is a secured credit facility given mostly to business institutions. Stock in hand, raw materials, other tangible assets, etc. are provided as collateral. A certain sum is allowed as credit for a short period.
c) Discounting of Bills:
Business customers approach banks to discount the commercial bills of exchanges and provide money. It is a short term credit instrument. Banks deduct the discount (interest) for the period mentioned in the bill and release the balance amount to the traders.
B.Loans:
Short term and medium term loans are provided by commercial banks against eligible collaterals to business concerns. It is a definite sum of money lent for a definite period. It is repayable in one lump sum or in instalments. Interest is payable on the entire loan amount. Generally commercial banks provide the following loans.
a) Housing Loan:
Taking the title deeds of the house as collateral security, based on the monthly income of the borrowing customer, banks advance medium and long term loans. The customer has to repay the loan in equated monthly instalments (EMI consists of principal and interest).
b) Consumer Loans:
Consumer durables like refrigerator, air conditioner, laptop, washing machine, television, etc. can be purchased by customers with consumer loans from banks. The product purchased is hypothecated (secured loan arrangement where the movable asset remains with the borrower) as security for the consumer loan amount. The customer pays in equated monthly instalments for a specified period.
c) Vehicle Loans:
Two wheelers, cars, buses and other vehicles can be purchased by individuals as well as institutions obtaining vehicle loans from the banks. Vehicles are hypothecated to the bank until the entire loan amount is repaid. Vehicle registration book is deposited with the bank and on full payment of loan amount it will be handed over to the customer.
d) Educational Loan:
Loan is provided by banks to students for studying undergraduate, post graduate or professional courses. Loan may be received in instalments to pay the educational fees every year. After completion of the course one year is allowed for the student to get employed. Afterwards, the student should repay the loan with interest for the entire period. Interest is charged from the date of first instalment of loan amount payment.
e) Jewel Loan:
Customers pledge their gold jewels and obtain loans from banks. The margin (percentage of value per gram that can be given as credit) requirement is fixed by the RBI. Interest should be paid every month. Otherwise interest on interest is charged. Within 12 months the customer can redeem or else can re-pledge. Jewels not redeemed even after reminders are sold in auction by banks to recover their dues.
3. Creation of Credit:
Apart from the currency money issued by the RBI, the credit money in circulation created by commercial banks influence economic activities of a country to a large extent. Credit money of commercial banks is far greater in volume than the currency money. The volume, the purposes and the sector to which this credit money is to be channelised - all these are implemented by commercial banks under the guidance of the RBI.

The following are the characteristics of Commerce.
(i) Economic activities:
(1) All economic activities are undertaken to earn Profit. commerce deals with all economic activities undertaken for profit.
(2) So, commerce is concerned with all economic activities directed towards earning profit.
(ii) Exchange of goods and services :
(1) Commerce involves an exchange of goods and services for profit.
(2) Goods may be produced for the purpose of resale to the consumers.
 (iii) Earning motive :
(1) Profit is an incentive for undertaking all commercial activities.
(2) Any activity, which does not have the incentive of profit, will not be a part of commerce.
For Example: If a trader gives some goods as Charity.
(iv) Creation of Utility:
Commerce creates form, place and time utility in goods.
(v) Regularity of transaction:
The transaction should be regular. No isolated transaction will be a part of commerce.

Arguments against social responsibilities:
Critics of the social responsibility concept put forward the following arguments.
(i) Lack of conceptual clarity :
(1) The concept of Social responsibility is very vague and amenable to different interpretations.
(2) There is no consensus on its meaning and scope.
(3) In such a situation, it would be futile as well as risky to accept social responsibility.
(ii) Dilution of Economic goals :
(1) By accepting social responsibility, business compromise with Economic goals
(2) Business is an Economic Institution and its only responsibility is to make maximum possible profits for its owners.
(3) It would endanger its Economic viability by accepting any other responsibility.
(iii) Lack of Social skill :
(1) Business organisations and their managers are not familiar with social affairs.
(2) There are special social service organisations such as Government and Non-governmental Agencies which can better deal with Social problems.
(iv)  Burden on consumers:
(1) If Business deals with Social problems, cost of doing Business would increase.
(2) These costs will be passed on to consumers in the form of higher prices or will have to be borne by owners.
(3) This would lead to taxation without representation.
(v) Responsibility without power:
(1) Business organisations possess only economic power and not social power.
(2) It is unjust to impose social responsibilities with social power.
(3) If Business is allowed to intervene in social affairs it may perpetuate its own value system to the detriment of society.
(vi) Misuse of Responsibilities: 
(1) Acceptance of social responsibilities will involve diversion of precious management time and talent on social action programmes.
(2) It may result in dilution of valuable corporate resources.
(vii) lack of Yard stick :
(1) Profitability is the common .criteria for decision - making in Business.
(2) Tampering it with social responsibility would make the decision-making process quite complex and controversial.
(viii) Improper role:
(1) The proper role of Business is to use  its resources and energies efficiently so as to earn the best possible return .on Investment within the confines of law and ethics.
(2) Business should concentrate on economic performance leaving social service to other organisations.
(ix) Overloading Responsibility :
(1) Business organisations are already serving society by providing goods and services, generating employment, developing technology and contributing to public exchequer through tax payments.
(2) It would be unjust to overburden them with further responsibilities.

 Sl.No   Basis   Direct Taxes   Indirect Taxes    1  Meaning  It is a systematic record of all Economic transactions happened between the resident of one country and resident of foreign countries during a particular period. Balance of Trade is a statement showing net effect of Export and Import of a Country.   2  Nature of Transactions recorded   It records both the transactions relating to goods and services.  It records only transactions relating to merchandise i.e. goods.   3  Capital Transaction It records Capital transactions It does not record Capital transactions   4  Structure It includes balance of Trade, balance of services, balance of unilateral transfers and balance of Capital transactions It is a part of Current Account of Balance of payments.   5  Net position It always remains balanced in the sense that receipt side is made equal to payment side. It may be at favourable or unfavourable or in equilibrium state   6  Indicator of Economic Status It is a true indicator of Economic performance of an Economy. It is not a true indicator of Economic prosperity or Economic relations of country.   7  Correcting unfavourableness  Unfavourable balance of payment leads to deficit in balance of payment situation. Unfavourable balance of trade can be converted into favourable balance of payment.

Foreign currency convertible Bond (FCCB) is a special type of bond issued in the currency other than home currency. In other words, companies issue Foreign Currency convertible bonds to raise money in Foreign Currency.
Features of FCCBs are given below:
1. FCCB is issued by an Indian company in foreign currency.
2. These are listed and traded in foreign stock exchange and similar to the debenture.
3. It is a convertible debt instrument.
4. It carries interest coupon.
5. It is unsecured.
6. It gives its holders the right to convert for a fixed numbers of shares at a predetermined price.
7. It can be converted into equity or depository receipt after a certain period.

Principles of Insurance:
Insurance concept was started to distribute risk among group or people. Co-operation is the basic principle behind every Insurance contract. The following are the important principles of Insurance.
a) Utmost Good Faith:
1. According to this principle, both insurer and insured should enter into contract in good faith.
2. Insured should provide all the information that impacts the subject matter.
3. Example: Mr. M is a heart patient. But he hides this fact to the LIC while taking a life policy. On his death due to a heart attack, LIC can refuse to pay compensation to his legal representative because a material fact was not disclosed by the insured.
b) Insurable Interest:
1. The insured must have an insurable interest in the subject matter of insurance.
2. Insurable interest means some pecuniary interest in the subject matter of the insurance contract.
3. The insured must have an interest in the preservation of the thing or life insured, so that they will suffer financially on the happening of the event against which they are insured.
4. Example, a businessman has insurable interest in his stock of goods.
c) Indemnity :
1. Indemnity means security or compensation against loss or damages.
2. In insurance, the insured would be compensated with the amount equivalent to the actual loss and not the amount exceeding the loss.
3. "The principle of indemnity is not applicable to life insurance because one cannot estimate the loss due to the death of a person".
d) Causa Proxima:
1. The word 'Causa proxima' means 'nearest cause'.
2. According to this principle, when the loss is the result of two or more cause, the proximate cause, i.e. the direct.
3. The direct, the most dominant and most effective cause of loss should be taken into consideration.
4. The insurance company is not liable for the remote cause.
e) Contribution:
1. The same subject matter may be insured with more than one insurer then it is known as 'Double Insurance'.
2. In such a case, the insurance claim to be paid to the insured must be shared on contributed by all insurers in proportion to the sum assured by each one of them.
3. Example: A businessman gets his factory insured against fire for Rs 10,00,000 with insurer A and Rs. 5,00,000 with insurer B.
4. Due to fire, a loss of Rs 1,50,000 occurred.
5. Then, insurers A and B will contribute the loss in the ratio of 2:1.
6. A will pay Rs. 1,00,000 and B will pay Rs. 50,000.
f) Subrogation:
1. Subrogation means 'stepping the shoes on others'.
2. According to this principle,once the claim of the insured has been settled, the ownership right of the subject matter of insurance passes on to the insurer.
3. Example Mr.B gets his motor car insured. Some of its parts got damaged in a road accident.
4. He gets the insurance claim and gets the damaged parts replaced with new ones.
5. In this case the damaged parts will be taken by the insurance company.
6. The insured has no right over the damaged parts since they had already got compensation for the damaged parts.
g) Mitigation:
1. In case of a mishap, the insured must take off all possible steps to reduce or mitigate the loss or damage to the subject matter of insurance.
2. This principle ensures that the insured does not become negligent about the safety of the subject matter after taking the insurance policy.

Mode of Discharge of contract:
Different modes of discharge of contract have been provided under different sections of the Act.
1. Discharge by Performance:
Performance implies carrying out the obligation of the contract. Performance must be completed according to the real intentions of the agreement. Performance must be done according to time and manner prescribed. Performance of contract may be of two types namely:
1. Actual performance
2. Attempted performance
2. By Agreement on Consent:
Agreement between the parties comes to an end by mutually agreeing for it. Any contract is created by an agreement, hence in the same way, it can be discharged by an agreement. In this connection the rule of law is as follows. "Eodem modo qus and quide constituitor, eodem modo destruitur," the meaning of which is that a thing may be destroyed in the same manner, in which, it is constituted. The consent may be of the following types:
Express: Express consent may be given at the time of formation of the contract or subsequent to its formation.
Implied : The contracts are also discharged by implied consent, different modes of discharge by implied consent are mentioned below:
(a) Novation
(b) Alteration
(c) Recession
(d) Remission
(e) Accord and Satisfaction
(f) Waiver
(g) Merger.
3. By a possibility of Performance:
A Contract may be discharged if its performance becomes impossible. The rule of impossibility of performance is based on the following maxims
1. the law does not recognize what is impossible and
2. what is impossible does not create an obligation.
According to the Section 56 of the Act, all acts to do impossible acts are void. There are two types of impossibility of performance such as
1. Impossibility existing at the time of agreement
2. Impossibility arising subsequent to the formation of contract.
On the other hand, impossibility of performance existing at the time of performánce of a contract may be either.
1. known to the parties
2. not known to the parties.
Likewise impossibility arising subsequent to the formation of a contract or supervening impossibility may be
1. By some event beyond the control of the parties or
2. By some act either of the promisor or of the promisee.
4. By Lapse of Time:
1. According to the Limitation Act, 1963 a contract must be performed within a specified time.
2. If it is not performed within this specified time limit and against which if no action is taken by the promisee in the Court of Law within specified time, then the promisee is deprived of his remedy at law
3. In such cases, the contract is discharged.
5. By Operation of Law:
A contract can be discharged by the operation of law. The operation of law by which contract can be discharged are as follows
By death :
If the contracts depend on the personal skill or ability, then such contract may be discharged on the death of the promisor.
By merger:
Merger will take place when an inferior right accruing to the same party either under the same or another contract.
By insolvency:
An insolvent is discharged from all liabilities incurred prior to his adjudication.
Unauthorized alteration of the terms of a contract:
If one party makes any material alteration in the contract without the consent of the other party, then the other party can avoid the contract.
Rights and liabilities vesting in the same person:
Where the right and liability become vested in the same person, the other parties are discharged.

Advantages of Public Corporation:
a) Bold Management due to Operational Autonomy:
i. A public corporation enjoys internal operational autonomy; as it is free from Governmental control. It can, therefore, run in a business like manner.
ii. Management can take bold decisions involving experimentation in its lines of activities, taking advantage of business situations.
b) Legislative Control:
i. Affairs of a public corporation are subject to scrutiny by Committees of Parliament or State Legislature.
ii. The Press also keeps a watchful eye on the working of a public corporation.
iii. This keeps a check on the unhealthy practices on the part of the management of the public corporation.
c) Qualified and Contented Staff:
i. Public corporation offers attractive service conditions to its staff. As such it is able to attract qualified staff.
ii. Because of qualified and contented staff, industrial relations problems are not much severe.
iii. Staff has a motivation to work hard for the corporation.
d) Tailor-Made Statute:
The special Act, by which a public corporation is created, can be tailor-made to meet the specific needs of the public corporation; so that the corporation can function in the best manner to achieve its objectives.
e) Not Affected by Political Changes:
i. Being a distinct legal entity, a public corporation is not much affected by political changes.
ii. It can maintain continuity of policy and operations.
Disadvantages of Public Corporation:
a) Autonomy and Flexibility, Only in Theory:
i. Autonomy and flexibility advantages of a public corporation exist only in theory
ii. In practice, there is a lot of interference in the working of a public corporation by ministers, government officers and other politicians.
b) Misuse of Monopolistic Power:
i. Public corporations often enjoy monopoly in their field of operation.
ii. As such,on the one hand they are indifferent to consumer needs and problems; and on the other hand, often do not hesitate to exploit consumers.
c) Rigid Constitution:
i. The constitution of a public corporation is very rigid.
ii. It cannot be changed, without amending the Statute of its formation. Hence, a public corporation could not be flexible in its operations.
d) Low Managerial Efficiency:
i. Quite often civil servants, who do not possess management knowledge and skills, are appointed by the government on the Board of Directors, of a public corporation.
ii. As such, managerial efficiency of public corporation is not as much as found in private business enterprises.
e) Problem of Passing a Special Act:
A public corporation cannot be formed without passing a special Act; which is a time consuming and difficult process. Hence, the scope for setting up public corporations is very restricted.

(i) Economic activities are undertaken to earn money.
(ii) Generally, people engage themselves in such activities on a regular basis and are said to be engaged in their occupation.
(iii) Occupations may be classified into three categories based on the following:
(1) Employment
(2) Profession
(3) Business
(1) Employment:
(a) It refers to the occupation in which people work for others and get remuneration in the form of wages or salaries.
(b) The one who is employed by others are called employees and the one who employs others is called employer.
(c) Managers, Clerks, Bank officials, Factory workers etc., are examples of employees.
(2) Profession:
(a) Professions are those occupations which involve rendering of personal services of a special and expert nature.
(b) A profession is something which is more than a job. It is a career for someone who is competent in their respective areas.
(c) It includes professional activities which are subject to guidelines or codes of conduct laid down by professional bodies.
(d) Those engaged in a profession are called professionals and. they earn income by charging professional fee.
(3) Business :
Business refers to any human activity undertaken on a regular basis with the object to earn profit through production, distribution, purchase and sale of goods and services.

The main advantages of Partnership are given below:
(i) Easy formation: The formation of partnership firm requires fulfillment of lesser legal formalities than other types of organisation. What required is just an agreement, which can be oral or written.
(ii) Availability of larger resources: The combined capital of all the partners and the greater borrowing capacity make available larger financial resources. New partners can also be taken into partnership to secure more capital.
(iii) Benefit of consultation: Two heads are better than one. Wise decision can be possible when the issues and subject matters are thoroughly discussed.
(iv) Division of Work and greater managerial Reduced Risk: The risk of each partner is reduced considerably since the loss sustained by the firm is shared by all the partners.
(v) Safeguard of the Minority Interest: For all the vital matters unanimous consent of each partner is required.
(vi) Easy Dissolution: The dissolution of the partnership is also very simple. No legal hurdle is there for dissolving the firm.

Functions/Role of WTO:
WTO performs the following functions:
(i) It is a forum for negotiation and formalisation of trade agreement among the member countries.
(ii) It settles disputes and grievances relating to trade among the member countries.
(iii) It frames commonly accepted code of conduct in order to reduce trade barriers.
(iv) It holds consultation with IMF and World Bank (IBRD) and its affiliates to bring about a greater understanding and co-operation in global economic policymaking.
(v) It supervises the operation of agreement relating to General Agreement on Tariffs and Trade (GATT) and Trade-related intellectual properties Rights (TRIPS).
(vi) It regulates trade between participating countries.

Based on the Ownership Pattern:
Any bank in which not less than 51 percent of shares are owned by the Government are called Government banks or public sector commercial banks (Total 21). All nationalized banks (19 banks, in 2017), SBI and IDBI Ltd. are public sector commercial banks. All of them are joint stock company type banks. There are corporation type banks. Each corporation type bank is established by a separate Act of Parliament and is fully owned by Government of India.
Examples: IFCI, SIDBI, EXIM Bank, etc.
All banking companies owned by private people are called private sector commercial banks. All cooperative banks are owned by its members from the public. In 1969, there were 14 private banks. They were concentrated in cities and towns. Their objective was to earn more profits. In order to channelize the funds with these commercial banks towards national priorities and to develop agricultural and rural sector, nationalization of banks was undertaken. Government paid the share capital of those banks to the private owners and took over as Government banks. This is called nationalization of banks. 6 more banks were nationalised in 1980. New Bank of India one of the nationalised bank merged with Punjab National Bank in 1980 and today there only 19 nationalised banks (2017).
Examples:
1. Nationalised banks: Indian Bank, Indian Overseas Bank, Oriental Bank of Commerce.
2. Public sector banks: State Bank of India, IDBI Bank Ltd. and all nationalised banks.
3. Private sector banks: Lakshmi Vilas Bank, Karur Vysya Bank, Kotak Mahindra bank.
Note Bharatiya Mahila Bank established on 19, November 2013 to serve exclusively women members of the public was merged with SBI on 31 March, 2017.

1. The Chamber of Commerce and Industry is an association of business and industrial houses like merchants, financiers, manufacturers, etc. in a locality, region, or state.
2. The main objective of these associations is to promote and protect the interest and goals of Indian commerce and industry.
3. These associations are non-profit making organisation and its members are institutional members.
Functions:
1. They act as national guardians of trade, commerce and industry.
2. They act as a catalyst in strengthening the internal trade of the country.
3. Interact with Government with regard to formulation and implementation related policies.
Associations or Chambers in India:
1. Federation of Indian Chambers of Commerce and Industry (FICCI), New Delhi.
2. Associated Chamber of Commerce and Industry (ASSOCHAM)
3. Confederation of Indian Industry (CII)
4. Madras Chamber of Commerce, Chennai.
5. Tamil Nadu Traders Associations.
Role of Associations or Chambers:
(i) Transportation or inter-state movement of goods:
The chamber facilitates registration of vehicles, surface transport- facilities, construction of highways and roads in promoting interstate movement of goods.
(ii) Harmonisation of CGST and SGST:
The Chamber of Commerce constantly interact with the Government to harmonise the CGST (Central Goods and Services Tax) and SGST (State goods and Services Tax) in different states. According to Governments, new policy value added Tax is being imposed.
(iii) Marketing of Agro products and related Issues:
The association of agriculturists and other federations interact with farming co-operatives to streamline local subsidies and formulate marketing policies for selling Agro products.
(iv) Weights and measures and duplication of brands:
They help the government in formulation and implementation of uniform policies in weights and measures and prevention of duplication of brands.
(v) Promoting Sound infrastructure:
They interact with Government to construct roads, ports, electricity, railways, etc.
(vi) Labour Legislation:
They interact with the Government on regular basis the issues related to labour laws, retrenchments, compensation, etc. So that the industry can run efficiently, generate employment and achieve maximum productivity.

Under Section 46, performance within a reasonable time:
According to Section 46, a promisor is to perform his promise within a reasonable time.
Under Section 47, specified time and place for performance:
If the promise is to be performed on a certain day, the promisor may undertake to perform it without application of the promisee
Under Section 48, performance on a certain day:
If the promise is to be performed on a certain day the promisor may undertake to perform it after the application by the promisee to that effect.
Under Section 50, performance is prescribed by the promisee:
According to Section 50, the performance of any promise may be made in any manner or at any time, which the promisee prescribes.

Basis Business Profession Employment (1) Mode of Establishment Promoter's decision registration and other formalities as
prescribed by law. Membership of a professional body or certificate of practice. Service contract or letter of appointment. (2) Nature of Work Goods and services provided to the public Personalized service of expert nature Performing work assigned by the employer (3) Qualification No minimum qualification is essential Education and training in specialized field. Minimum qualification is essential. (4) Basic Motive Earning profits by satisfying needs of society. Rendering service. Earning wages or salary by serving the employer. (5) Capital Capital investment required as per size of the firm. Limited capital necessary for establishment. No capital required. (6) Reward Profits Professional fee Salary or wages (7) Risk Profits are uncertain and irregular. Fee is regular and certain, never negative Fixed and regular pay, no risk. (8) Transfer of Interest Transfer possible with
some formalities Not possible Not transferable (9) Code of Ethics No specific code of
conduct, moral and
ethical dealings only Professional code of ethics Rules and regulations
of the employing
organization

(i) Indias' representative in the world Financial Institutions:
(1) In order to maintain consistency and harmony with international banking standards the RBI associated with the Basel Committee on Banking Supervision (BCBS - Switzerland) since 1997.
(2) RBI represents Government of India in International Bank for Reconstruction and Development (IBRD i.e. World Bank) and International Monetary Fund (IMF) in which India is a member since 27th December, 1945.
(ii) Regulator and Supervisor of Indian Banking System:
(1) The broad guidelines for all banking operations in the country are formulated by the RBI.
(2) The RBI has power to issue licenses, control and supervise commercial banks under the RBI Act, 1934 and the Banking Regulation Act, 1949.
(3) It conducts inspection of the commercial banks and calls for returns and other necessary information from them.
(iii) Monetary Authority:
(1) The RBI formulates, implements and monitors the monetary policy of the country in order to maintain price stability, controlling inflationary trends and economic growth. It provides advices to the Government concerning agricultural finance, resource mobilization for implementing plans and legislation affecting banking and credit and international finance.
(iv) Closely Monitoring Economic Parameters:
(1) Broad economic parameters such as employment level, price levels and production levels, trade cycles, foreign' investment flows, balance of payments, financial markets, etc., are closely monitored by the RBI in order to achieve economic stability and growth.
(2) The Board of Financial Supervision (a committee of the Central Board of Directors) of the RBI meets at least once in a month (at times every day) to closely monitor all these current developments in the country.
(v) Promptly Responding to New  Challenges:
(1) Whenever challenges arose before Indian Banking System, RBI promptly attend them by issuing Master Circulars and by organising committees to analyse, review and strengthen Indian Banking.
(2) A wealth of information can be found in every Master Circular or committee report.
(3) Example: Gopalakrishnan Committee on "Information security, Electronic Banking", April, 2010.

Advantages of railway transport:
1. Railways are well suited for carrying heavy and bulky goods over long distances.
2. It can provide long distance travel throughout the day and night with unbroken Services.
3. It can provide better production and safety to the goods than motor transport.
4. The goods generally carried in closed wagons are not exposed to sun, rain, etc.
5. Though initial investment is large, in the long run the operating expenses will be very low in railways and it will prove a cheaper mode of transport.
6. It requires less time than motor transport for carrying goods over long distance with greater speed.
7. It has regular schedule of timing and is available throughout the year.
8. It provides unaffected services whether rainy or shiny weather conditions.

(i)  Business to Customer (B2C) :
1. This is fastest growing segment in e-commerce space.
2. Under this model, business concern sells directly to consumers
(ii) Business to Business (B2B) :
1. Under the model, business concerns transact with one another through internet.
2. For instance, Snapdeal, Flipkart, Alibaba, Indiamart, Trade India. Com etc
(iii) Consumer to consumer (C2C) :
1. Under this model, customers sell directly to other customers through online classified advertisement or through auction or through mobile or through market places. 
2. Example : Indian ventures in C 2 C are Kraftly App (Buying and Selling anything) which deals in hand made products of a wide range. Once again store.
3. Com is a website that buys pre ~ owned women's fashion products. Other players are quikr,Olx, ebay etc 
(iv) Customer to Business (C2B) :
1. This model is reverse to auction model. Products like automobile, electronic items furniture and similar product are traded by customer through websites. 
2. Example : Naukri.com, and Monster.com are examples of Indian companies operating in this domain.
(v) Business to Government (B2G) :
1. This model envisages selling products and services by business consumer to Government organization.
2. For instance TCS operates the passport application process for the Government of India as part off - line process.

Contents of Partnership Deed:
a) Name:
Name of the Firm.
b) Nature of Business:
Nature of the proposed business to, be carried on by the partners.
c) Duration of Partnership:
Duration of the partnership business whether it is to be run for a fixed period of time or whether it is to be dissolved after completing a particular venture.
d) Capital Contribution:
The capital is to be contributed by the partners. It must be remembered that capital contribution is not necessary to become a partner for one who contribute his organising power, business acumen, managerial skill, etc., instead of capital.
e) Withdrawal from the Firm:
The amount that can be withdrawn from the firm by each partner
f) Profit/Loss Sharing:
The ratio in which the profits or losses are to be shared. If the profit sharing ratio is not specified in the deed, all the partners must share the profits and bear the losses equally.
g) Interest on Capital:
Whether any interest is to be allowed on capital and if so, the rate of interest. If the deed is silent on interest on capital, the rules for interest on capital in partnership act will take effect.
h) Rate of Interest on Drawing:
Whether any interest is to be allowed on drawing, the rate of interest is to be specified.
i) Loan from Partners:
Whether loans can be accepted from the partners and if so the rate of interest payable there on.
j) Account Keeping:
Maintenance of accounts and audit.
k) Salary and Commission to Partners:
Amount of salary or commission payable to partners for their services. (Unless this is specifically provided, no partner is entitled to any salary).
l) Retirement:
Matters relating to retirement of a partner. The arrangement to be made for paying out the amount due to a retired or deceased partner must also be stated.
m) Goodwill Valuation:
Method of valuing goodwill on the admission, death or retirement of a partner.
n) Distribution of Responsibility:
The work that is entrusted to each partner is better stated in the deed itself.
o) Dissolution Procedure:
Procedure for dissolution of the firm and the mode of settlement of accounts thereafter.
p) Arbitration of Dispute:
Arbitration in case of disputes among partners. The deed should provide the method for settling disputes or difference of opinion. This clause will avoid costly litigations.

a. Maintenance of book debts :
A factor takes the responsibility of maintaining the accounts of debtors of a business institution
b. Credit coverage :
The factor accepts the risk burden of loss of bad debts leaving the seller to concentrate on his core business.
c. Cash advances: 
Around eighty percent of the total amount of accounts receivables is paid as advance cash to the client
d. Collection service :
Issuing reminders, receiving part payments, collection of cheques form part of the factoring service.
e. Advice to clients :
From the past history of debtors, the factor is able to provide advices regarding the credit worthiness of customers, perception of customers about the products of the client, etc.

(i) Warehouse Warrant:
(1) It is a document issued in favour of the owner or depositor of goods by the warehouse keeper.
(2) This is a document of title of goods and can be transferred by simple endorsement and delivery.
(3) To transfer all the goods the warehouse warrant is sufficient.
(ii) Warehouse Keeper's Receipt:
(1) It is a document issued by the warehouse keeper, which acknowledges the receipt of goods from the depositor of goods.
(2) It also shows the existence of an agreement to keep the goods in the warehouse subject to certain conditions.
(3) This is not a document of title to goods and it is not transferable.
(iii) Dock Warrant:
(1) Dock is a place in the harbor where the goods are loaded into the ship. Dock warrant is a document of title of goods issued by dock authorities.
(2) This document certifies that the dock authorities hold the goods. To take delivery of the goods this certificate should be given back to dock authorities.
(3) The right of getting delivery of goods can be assigned to third parties too.
(iv) Dock Receipt:
(1) Dock receipt is an acknowledgement of receipt of goods issued by dock authorities to the owner of the goods.
(2) It is not a document of title of goods. Therefore, the right of taking of delivery of goods cannot be transferred.
(v) Delivery Order:
(1) This is a document through which the depositor directs the warehouse keeper to deliver the specified goods either to the party mentioned in the document or to the bearer.
(2) The warehouse keeper delivers the goods as per the instruction. Transfer of ownership takes place through this document.
(3) To transfer all the goods the warehouse warrant is sufficient. If only part of the goods are to be transferred then the delivery order is needed. The delivery order is to be accompanied by warehouse warrant.

Sources of Short Term Finance:
Short term funds are those sources which are required by the business firms for a period of within one year. Some of the important Sources of short term finance are briefly explained below.
a) Loans and advances :
(1) Loan is a direct advance made in a lump sum which is credited to a separate loan account in the name of the borrower.
(2) The borrower can withdraw the entire amount in cash immediately. It can be repaid in one or more instalments.
b) Bank overdraft :
(1) Bank overdraft refers to an arrangement whereby the bank allows the customers to overdraw the required amount from its current deposit account within a specified limit.
(2) Interest is charged only on the amount actually overdrawn.
c) Discounting of Bills of Exchange:
Discount bills of exchange refers to an act of selling the bill to obtain payment for it before maturity.
d) Trade Credit:
1. Trade credit is the credit extended-by one trader to another for the purpose of purchasing goods and services.
2. Purchaser need not pay money immediately after the purchase.
3. Such credit appears in balance sheet as Trade Creditors, or Accounts Payable.
e) Pledge:
1. A customer transfers the possession of an article with the creditor (banker) and receives loan.
2. Till the repayment of loan, the article is under the custody of the borrower.
3. If the debtor fails to refund the loan, creditor (banker) will auction the article pawned and adjust the outstanding loan from the sale proceeds.
f) Hypothecation:
1. This is loan taken by depositing document of title to the property with the banker
2. Of course the physical possession of asset property ís with the borrower
3. If the borrower fails to repay the loan amount, the article hypothecated will be sold in auction by the concerned banker.
g) Mortgage:
1. This is a type of loan taken from the bank by lodging with the banker title deeds of immovable assets like land and building
2. Business people raise loans by depositing the title deeds of the properties with the bank.
h) Loans against Securities :
Banks accept various types of securities like Fixed deposit receipt, book debts, insurance policies, supply bills, shares, debentures, bonds of companies, document of title to goods like railway receipt, bill of lading, trust receipt, ware house keepers receipt, book debts and so on and provides loan on the basis of the afore said securities.
i) Clean loan:
(1) Banks provide clean loan to certain customer of outstanding credit worthiness on the basis of their character, capacity and capability. It simply grants loan without any physical security.
(2) In other words clean loan is loan given without any security or with personal security.
j) Commercial Paper (CP):
1. Commercial paper (CP) is an unsecured money market instrument in the form of a promissory note.
2. It was introduced in India in 1990 under Section 45W of the Reserve Bank of India Act. It is issued by a firm to raise funds for a short period.
3. It can be issued for maturities between a minimum of 7 days and a maximum of up to one year from the date of issue.
k) Hire Purchase Finance:
1. Small scale firms can acquire industrial machinery, office equipments, vehicles etc., without making full payment through hire purchase.
2. With the help of assets acquired through hire purchase, they can produce and sell. From the earnings, payments can easily be made in instalments.
l) Factoring:
1. Factoring is a one of the methods of raising business finance through sale or mortgage of book debts.
2. Under this method business concerns sell the accounts receivable to a finance company called a factor at a discount.

Sl.No	Basis	Contract	Agreement
1	Definition	A contract is an agreement enforceable by law	An Agreement is every promise or every set of promises forming consideration
2	Enforceability	Every contract is enforceable	Every promise is not enforceable
3	Inter-relation-ship	A contract includes an agreement	An Agreement does not include a contract
4	Validity	Only legal agreements are called contracts.	An agreement may be both legal and illegal
5	Legal obligation	Every contract contains a legal obligation	It is not necessary for every agreement to have legal obligation.

Consumers Cooperative:
Consumer cooperatives are organized by consumers that want to achieve better prices or quality in the goods or services they purchase.
Producers Cooperative:
Producer cooperatives are established and operated by producers. Producers can decide to work together or as separate entities to help increase marketing possibilities and production efficiency.
Marketing Cooperative:
Cooperative marketing societies are associations of small producers formed for the purpose of marketing their produce.
Credit Cooperative:
Cooperative credit societies are societies formed for providing short-term financial help to their members.
Housing Cooperative:
These cooperative housing societies are meant to provide residential accommodation to their members on ownership basis or on rent.
Cooperative Farming Societies:
When various farmers in a village pool their land together and agree to; treat the pooled piece of land as one big farm for the purpose of cultivation, purchase the necessary inputs for the cultivation, and market the crops jointly, they are assumed to have formed a cooperative farming society. Such a society, for its proper working elects its office bearers on the basis of one member-one-vote.

Characteristics of Wholesalers:
(i) Collection of Goods:
A wholesaler collect the goods from manufacturer or producers in large.
(ii) Storage of Goods :
A wholesaler collects and stores them safely in warehouses, till they are sold out. Perishable goods like fruits, vegetables, etc. are stored in cold storage.
(iii) Distribution:
A wholesaler sells goods to different retailers. In this way, he also performs the function of distribution.
(iv) Financing:
(1) The wholesalers provide financial support to producers and manufacturers by providing money in advance to them.
(2) He also sells goods to retailers on credit. Thus, at both ends wholesaler acts as a financier.
(v) Risk Taking:
The wholesaler buys finished goods from the producer and keep them in the warehouses till the time they are sold and assumes the risk against rise in price, spoilage of goods and change in demand.
(vi) Grading, Packing and Packaging:
He classifies the goods into different categories. He grades the goods on the basis of quality, size and weight, etc. He also undertakes packaging of goods and also perform the functions of branding.
(vii) Providing Information:
Wholesaler provide valuable information to retailers and producers. The retailers are informed about the quality and type of products available in the market for sale, where as the producers are informed about the changes in taste and fashions of consumers so that they may produce the goods on the basis of taste and fashion.
(viii) Transportation:
A wholesaler arranges for the transport of goods from producers to his warehouse and from the warehouse to retailers. Many wholesalers maintain their own trucks, carries goods in bulk and adds place utility to the goods.

Warehouses are classified as follows:
(i) On the basis of ownership :
(1) Private Warehouses
(2) Government Warehouses
(3) Public Warehouses
(4) Co-operative Warehouses
(5) Bonded Warehouses
(6) Institutional Warehouses
(7) Distribution Centre Warehouses
(ii) On the Basis of Commodities Stored :
(1) General Warehouses
(2) Special Commodity Warehouses
(3) Cold Storages or Refrigerated Warehouses
(4) Climate Controlled Warehouses.
(i) On the basis of ownership :
(a) Private Warehouses:
Private warehouses are built and owned by private business enterprises to store their own products. They are exclusively for their use and are not meant for other manufacturing or business units.
(b) Government Warehouses:
They are created and operated by the Government to implement the programmes of the government. Their services mostly available to government only.
(c) Public Warehouse:
It is open for public at large. Most of the business organisations, especially small and medium scale units cannot afford to have their own warehouses. They may be owned by an individual or some agency. These warehouses operate as per the rules and regulations formed by the Government.
(d) Co-operative Warehouses:
There are warehouses owned and managed by the marketing co-operative societies or agricultural co-operative societies. They are set up to provide warehousing facilities to their members. Example: National Co-operative Development Corporation (NCDC).
(e) Bonded Warehouses:
Bonded warehouses are those warehouses, which are licensed by the government to accept storage of imported goods which are not cleared due to non-payment of customs duty by the importer. Branding can be undertaken in the warehouse itself. Bank loans can be obtained by submitting the receipt issued by these warehouses as collateral security. Strict supervision and control is imposed by custom authorities on their operation and functioning.
(f) Institutional Warehouses:
Different institutions and bodies have their own warehouses on account of the nature of operation. For Example: Banks, Railways, etc,. Various transport agencies also maintain warehouses for storing the goods which are to be dispatched and received.
g) Distribution Center Warehouses:
Goods which need to be temporarily stored for one or two days so that they can be distributed to other offices or customers are stored in Distribution Centers. They are owned by the manufacturer or wholesalers.
B. On the basis of commodities Stored:
a) General Warehouses:
They are ordinary warehouses which are useful for storing most of the dry food grains, fertilisers, etc. Protective measures against rat, insects, etc. are undertaken by them.
b) Special Commodity Warehouses:
These warehouses are specially constructed for storing specific type of commodities like tobacco, cotton, wool, etc. These warehouses reduce loss of quality and quantity to a great extent. Storage of petrol and oil requires special type of vertical, cylindrical storage tanks.
c) Cold storages or Refrigerated warehouses:
Goods are transported in refrigerated containers and stored in refrigerated warehouses. These warehouses are used for storing perishable goods like fruits, vegetables, eggs, butter, fish, meat, etc. Goods stored in cold storages without deterioration in quality, can be made available throughout the year.
d) Climate Controlled Warehouses:
The controlled climate environment can reduce the rate of metabolism in fruits and vegetables. Humidity controlled environments for delicate products such as flowers in dirt-free facilities is provided in these warehouses.
e) Automated Warehouses:
Automated facilities can handle several hundreds of kilograms of product at a time. Inside the warehouse premises physical distribution activities are carried out by moving product filled pallets (i.e. platforms that hold large amounts of product). It requires huge investment, latest technology and large turnover of goods.

Coastal Trade in Ancient Tamil Nadu:
1. Big cities like Poompuhar had the 'Maruvurappakam' (inland town) and 'Pattinapakkam' (coastal Town) had market and bazaars where many merchants met one another for the purpose of selling or buying different kinds of commodities and food stuff.
2. Port towns like Tondi, Korkai, Puhar and Muziri were always seen as busy with marts and markets with activities related to imports and exports.
3. In such a brisk trade, people of the coastal region, engaged themselves in coastal trade and developed their intercontinental trade contacts.
4. They were engaged in different kinds of fishing pearls, and conches and produced salts and built ships.
5. Boats like 'Padagu', 'Thimil', "Thoni', 'Ambu' 'Odampunai', etc... were used to cross rivers for domestic trade while Kalam, Marakalam, Vangam, Navai, etc.. were used for crossing oceans for foreign trade.

The passage of goods and services between the producer and the consumer is best with many hindrances and some of them are as follows:
Hindrance of person:
1. Manufacturers do not know the place and face of the consumers.
2. It is the retailer who knows the taste, preference and location of the consumers.
3. The chain of middlemen consisting of wholesalers, agents and retailers establish the link between the producers and consumers.
Hindrance of place:
1. Production takes place in one centre and consumers are spread throughout the country and world.
2. Rail, air, sea and land transports bring the products to the place of consumer.
Hindrance of time:
1. Consumers want products whenever they have money, time and willingness to buy.
2. Goods are produced in anticipation of such demands.
3. They are stored in warehouses in different regional centres so that they can be distributed at the right time to the consumers.
Hindrance of risk of deterioration in quality:
1. Proper packaging and modern air conditioned storage houses ensure that there is no deterioration in quality of products.
2. Goods are protected against insects, rats, evaporation etc..
Hindrance of risk of loss:
1. Fire, theft, floods and accidents may bring huge loss to the business.
2. Insurance companies serve to cover the risk of such losses.
Hindrance of knowledge:
Advertising and communication help in announcing the arrival of new products and their uses to the people.
Hindrance of exchange:
Money functions as a medium of exchange and enable the buying and selling of any product or service by payment of the right price.
Hindrance of finance:
1. Producers and traders may not have the required funds at the time of their need.
2. Banks and other financial institutions provide funds and help in transfer of funds to enable the functioning of business smoothly.
Hindrance of developing the exact product:
Research and development helps in developing the exact product or service which can satisfy the specific wants of consumers and. thus improve the standard of living of the people.
Hindrance of both selection and delivery at doorsteps:
E-Commerce enables the consumer to select the product in the website, place online orders and make payment after receiving the product at the door step.

 Sl.No   Basis   Domestic Business   International Business    1 Meaning  This represents a document acknowledging the receipt of goods on board for carrying them over to specified port of destination It refers to an agreement to hire a whole or major part of ship when the goods take exported is heavy.   2 Transferable  It can be transferred to third party by endorsement and delivery It cannot be transferred to third party   3 Loan Loan can be raised against it Loan cannot be raised it.   4 Crew Master and crew remain the agent of the ship owner Master and crew become the agent of exporter for a temporary period.   5 Lease It is not a lease of ship It is a lease of ship.

The functions of RBI can be grouped into under three heads.
(i) Leadership and supervisory functions
(ii) Traditional functions; and
(iii) Promotional functions
Leadership and Supervisory Functions:
RBI being the banking institutional head of India has to be a part of global institutions. It has to transform the quality and size of banks in India to the level of banks in developed countries.
a) India's Representative in World Financial Institutions:
In order to maintain consistency and harmony with international banking standards the RBI is associated with Basel Committee on Banking Supervision (BCBS, Switzerland) since 1997. RBI represents Government of India in International Bank for Reconstruction and Development (IBRD i.e. World Bank) and International Monetary Fund (IMF) in which India is a member since December 27, 1945.
Traditional Functions:
a) Banker and Financial Advisor to the Government:
The RBI accepts money into the Central and State Governments' accounts and make payments on their behalf. It manages Government debt and is responsible for issue of new loans.
b) Monopoly of Note Issue:
The RBI is the sole authority for the printing and issue of all currency notes in India except one rupee note. It is the duty of the RBI to ensure that sufficient number of good quality currency notes is available to the public.
Promotional Functions :
The RBI performs a wide range of promotional functions to support national objectives.
a) Nurturing Banking Habits among the Public:
It protects the depositors' interest and aim at providing cost-effective banking services in order to include more people to avail banking services. It has also taken up the task of extending the banking system territorially and functionally to the unbanked areas.
b) Grievance Settlement Measures:
RBI has appointed 20 (up to 2017) Banking Ombudsman in 20 state capitals. Banking Ombudsman Scheme is a speedy and inexpensive forum for resolution of customer complaints relating to certain services rendered by banks in India.

The following are the advantages of a Sole trader:
a) Easy Formation:
No legal formalities are required to initiate a sole trading concern. Any person capable of entering into a contract can start it, provided he has the necessary resources for it.
b) Incentive to Work hard:
There is a direct relationship between effort and reward. The fact that the entire profit can be taken by himself without sharing with anybody else induces him to work ceaselessly.
c) Small Capital:
Small capital is an important as well as the specific advantage of the sole proprietorship. The sole proprietor can start the business with small capital.
d) Credit Standing:
Since his private properties are held liable for satisfying business debts, he can get more financial assistance from others.
e) Personal Contact with the Customers:
Since sole proprietor knows each and every customer individually he can supply goods according to their taste and preferences. Thus he can cultivate personal relationship with the customers.
d) Flexibility:
The sole trader can easily adjust himself to the changing requirements of his business.