Entrepreneurial Planning — Entrepreneurship STD 12 Commerce — Question

How is working capital calculated? Illustrate with an example.

Name some Institutional investors to whom entrepreneurs can raise funds by selling the issues.

Explain the role of financial planning in financial management.

Why is it important to be able to categorise the business?
OR
Why is it important to carefully choose a legal structure for the business?

What do you understand by sales mix?
State the assumptions made for the calculation of breakeven point for sales mix.

'Golden Sweets' was a partnership firm, owned by Swati and Sushma. 'Asam Sweets' was another partnership firm owned by Vipan and Pranav. Swati and Sushma were sharing profits in 1:2 ratio and Vipan and Pranav were sharing profits in 2:3 ratio. Both the firms were situated in a famous market of Guwahati and were doing competitive business. Pranav the partner of 'Asam Sweets' observed that many of their customers were from far off areas and if branches of ‘Asam Sweets’ are opened in other parts of the city, the firm may earn huge profits. Similar was the situation of 'Golden Sweets'. One day in a function at a common friends house, the partners of both the firms knew that the internal expansion of their respective firms will be costly. Hence, they decided about the merger of the two firms. For this purpose, they decided to meet again to finalise the conditions of merger. Finally, on 1.1.2016 their respective firms were merged and a new firm ‘Asam Golden Sweets’ was formed with all the four partners Swati, Sushma, Vipan and Pranav. Their new profit sharing ratio was 1:2:2:3. During the year ended 31.12.2016, the new firm opened four new branches in different parts of the city and earned a profit of 30% on sales.

1. Identify the type of merger adopted by the two firms and also give its meaning.
2. Also give the names and meaning of two other types of mergers.

Abhiraj Chaudhary is into the business of manufacturing low-cost Diesel Cars in Germany. He is earning good profits and ambitiously considering overseas expansion. He scans the environment for finding out the opportunities and threats that may influence his current and future plans. He zeros down on India as a potential place for his business expansion as Indian Government has announced favourable trade regulations. On selling the first lot of cars in India, the Indian Government noticed that the emissions from these cars were above the permissible limit. The government asked him to make necessary modifications in his cars if he wanted to continue business in India. He readily agreed to meet the emission norms set by the Indian Government.

1. Quoting the lines from the above para identify any two environmental factors.
2. Also, state any two values which Abhiraj Chaudhary tried to communicate to the Indian Society.

Pankaj an entrepreneur started a new website 'Save Electricity' to sell LED bulbs. In the first year, he sold 2400 bulbs at the rate of 100 each. His cost of placing an order and receiving the bulbs is 500 per order. If the Economic Order Quantity is 200 buIbs, find out the inventory holding cost per year.

Michael Porter suggested some primary activities for an enterprise. What are they?