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Class 11th

Small business and source of finance


Total marks : 50
Page | 1
Time allowed 1 hour 30 minutes
1 Mark Question
Q1. What type of share capital is also called ‘’Risk Capital’’?
Q2. Name the return given to debenture holders for using their
funds?
Q3. Name the one unique feature of ‘’Retained Earnings’’ which is
not available in any any other source of finance?
Q4. What is the similarity between ADR and Public Deposits?
Q5. Which term is concerned with the acquisition and conservation
of capital funds in meeting the financial needs of a business
enterprise?
Q6. Which type of Industry uses family labour and local available
talent while running the business?
Q7. A micro small scale industry has investment of Rs. 24 lakhs and
engaged in manufacturing business. Now, it wants to increase its
investment byRs. 4 Lakhs. what type of small Business will it
become and what is the maximum investment limit in such cases?
Q8. Which type of enterprise is owned, controlled and managed by
a woman or a group of women holding share capital not less than
51%?
Q9. Name any 2 areas where SSLs feel threatened from global
enterprises.
Q10. Name any 2 merits of SSLs in the export trade of India.

PREPARED BY SAURABH GUPTA


4 MARK QUESTIONS
Q11. Write any FOUR differences between share and debentures.
Q12. Write any four advantages of Retained Earnings.
Page | 2
Q13. Write any four objectives of establishment of NABARD.
Q14. Write any four problems of small business in India.
6 MARK QUESTIONS
Q15. Preet food Industries set up food and beverages processing
plant in the rural area of Haryana and opted for labour intensive
technique due to easy availability of labour and to provide
employment to local people. Board of director decided to invest 50
lakhs to acquire plant & machinery, Rs. 1 crore to buy land, Rs. 20
Lakhs to buy raw material and Rs. 20lakhs to maintain day to day
expenses.
(a) Name the Act of Industries which is applicable to the above
industry.
(b) which category of part (a) will the above industry came?
(c) State the investment limit in this category.
Q16. ‘’Ojas Auto Ltd. ‘’ is a very well known auto company in the
industry having more of equity share capital than long term debt in
its capital structure. It is willing to expand and establish new unit in
the backward region and want to train the tribal women in skill
Development to empower them. It has a huge amount of cash
reserve of Rs. 1000 crores.
(a) what is the status of capital structure of the above company.
(b) According to you, which source of finance should be used by the
company in establishing new units? Give any two reasons in
support of your answer.

PREPARED BY SAURABH GUPTA


Q17 Board of Directors of ‘’Bio Pure water Ltd.’’ decides to set up
its first unit in the hilly area of Himachal Pradesh Company requires
Rs. 3 crores for it and Rs. 50 Lakhs for working capital. The company
has earned marked15% of its profit for Educational and Health Page | 3
needs of its employees and their family members.
(a) The above company comes under which category as per
MSMEDAct 2006.
(b) Write any one commercial reason for setting up of unit in the
hilly region.
(c) According to you, what are the options available to the company
for meeting its long term and short term needs.
Q18. ‘’Avika Ltd.’’ company, an IT giant company registered in India
want to top the huge\ amount of resources for its growth and
expansion from U.S.A.for long term needs. IT also needs money for
a period of less then 3 years to meet its medium cum short term
needs. The company is following the practice of educating and
giving employment to under privileged youth.50% of its office
electricity is generated through solar power.
(a) Which two sources of finance should be used by the company to
meet its requirement.
(b)Write any two characteristics of each source.

PREPARED BY SAURABH GUPTA

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