SUGGESTED ANSWERS TO

THE QUESTIONS SET AT

CHARTERED ACCOUNTANCY PROFESSIONAL (CAP)-I LEVEL

JUNE 2022 EXAMINATIONS

The Institute of Chartered Accountants of Nepal (ICAN)

ICAN Marg, Satdobato, Lalitpur
© The Institute of Chartered Accountants of Nepal
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Year and month of Publication: 2022 September

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The suggested answers published herein do not constitute the basis for evaluation of the students'
answers in the examination. The answers are prepared by the concerned resource persons and
compiled by the Technical Directorate of the Institute with a view to assist the students in their
education. While due care has been taken in the compilation of answers, if any errors or omissions
are noted, the same may be brought to the attention of the Technical Directorate. The Council or
the Board of Studies of the Institute is not any way responsible for the correctness or otherwise
of the answers published herewith.

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Table of Contents
Paper 1: Fundamentals of Accounting ........................................................................................... 4
Paper 2: Part A: Mercantile Laws ................................................................................................ 14
Paper 2: Part B: Fundamentals of Economics.............................................................................. 17
Paper 3: Part A: Fundamentals of Management .......................................................................... 25
Paper 3: Part B: Commercial Mathematics and Statistics ........................................................... 30
Examiner’s Commentary on Students' Performance in June 2022 Examinations ....................... 36

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Paper 1: Fundamentals of Accounting
Attempt all questions. Working notes should form part of the answer.
1. The following are the balance as at 31stAshadh, 2078 extracted from the books of M/s Roshan
Enterprises:
Particulars Amount (Rs.) Particulars Amount (Rs.)
Plant and machinery 40,500 Bad debts 2,200
Furniture & fittings 15,250 Bad debts recovered 1,250
Bank overdraft 160,000 Salaries 32,650
Capital account 115,000 Outstanding salaries 5,350
Drawings 15,000 Prepaid rent 500
Purchase 230,500 Rent 6,500
Opening stock 132,250 Carriage inward 2,350
Wages 22,325 Carriage outward 3,250
Provision for doubtful debts 5,700 Sales 358,100
Provision for discount on
1,375 Advertisement expenses 6,750
debtors
Sundry debtors 152,500 Printing and stationery 2,200
Sundry creditors 77,500 Cash in hand 2,300
Cash at bank 7,250 Investment 50,000

The following adjustment should be made:

a) Difference in the Trial Balance, if any, can be taken as miscellaneous eexpenses or
miscellaneous income.
b) Investment was sold at 10% profit, but entire proceeds have been booked as sales.
c) Bank overdraft is arrived against hypothecation of stock. The bank overdraft outstanding as
on 31stAshadh, 2078 accounted for 80% of drawing power. Such drawing power is ascertained
by deducting 20% as margin from the value of stock as on that date.
d) Purchase includes sales returned of Rs. 5,500 and sales include purchase return of Rs. 4,750.
e) Goods withdrawn by Mr. Roshan for own consumption Rs. 7,500 were included in purchase.
f) Depreciation is to be provided in plant & machinery @ 15% per annum, on furniture & fitting
@ 10% per annum.
g) Wages paid for installation of plant and machinery at the beginning of the year
amounting to Rs. 750 was included in wages account.

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 h) Create a provision for doubtful debts @ 5% and provision for discount on debtors @ 2.5%.
i) A debit balance of Rs. 2,500 in the account of Abdul, a creditor is included in the list of sundry
debtors.
j) Commission is payable @ 2.5% of the sales.
Prepare Trading and Profit & Loss Account for the year ended 31st Ashadh, 2078 and Statement
of Financial Position as at 31st Ashadh, 2078. 15

Answer
Trading and Profit Loss Account of M/s. Roshan Enterprises
For the Year Ended 31.03.2078

Particulars Amount Particulars Amount

To Opening Stock 132,250 By Sales 358,100
To Purchase 230,500 Less: Sales Return 5,500
Less: Purchase
Less: Sales Return 5,500 Return 4,750
Less: Sales of
Less: Purchase Return 4,750 Investment 55,000 292,850
Less: Drawings 7,500 212,750 [50,000*110%]
To Carriage Inward 2,350 By Closing Stock 250,000
To Wages 22,325 [160,000/(0.8*0.8)
Less: Installation 750 21,575
To Gross Profit 173,925
542,850 542,850
To Salary 32,650 By Gross Profit 173,925
By Bad Debt
To Rent 6,500 Recovered 1,250
By Gain on sale -
To Advertisement 6,750 Investment 5,000
To Printing & Stationery 2,200 [50,000*10%]
To Carriage Outward 3,250
To Depreciation - Plant & Machinery 6,188
[40,500+750]*15%

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To Depreciation - Furniture & Fittings 1,525
To Provision for Bad
Debt [WN-1] 4,000
To Provision for Discount [WN-2] 2,188
To Sales Commission 7,321
To Net Profit 107,604
Total 180,175 Total 180,175

Balance Sheet of M/s Roshan Enterprises

As at 31.03.2078

Capital & Liabilities Amount Assets Amount

Plant &
Capital 115,000 Machinery 41,250
Less:
Add: Net Profit 107,604 Depreciation 6,188 35,063
Less: Drawings
[15000+7500] 22,500 200,104 Furniture & Fittings 15,250
Less:
Depreciation 1,525 13,725
Investment 50,000
Bank Overdraft 160,000 Less: Sales 50,000 -
Sundry Creditors 77,500 Debtors [WN-3] 138,938
Advance to
Creditors 2,500
Outstanding Salary 5,350 Cash at Bank 7,250
Cash in Hand 2,300
Sales Commission
Payable 7,321 Prepaid Rent 500
Closing Stock 250,000
Total 450,275 Total 450,275

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 Working Note - 1
Dr. Provision for Bad Debt A/C Cr.
To Bad Debt 2,200 By Balance b/d 5,700
To Balance c/d 7,500 By P/L A/c 4,000
[152,500 - 2500] * 5% [To be Charged to P/L A/c]
Total 9,700 Total 9,700

Working Note - 2
Dr. Provision for Discount A/C Cr.
To Discount Allowed - By Balance b/d 1,375
To Balance c/d 3,563 By P/L A/c 2,188
[152,500 - 2500] * 5% [To be Charged to P/L A/c]
Total 3,563 Total 3,563

Working Note - 3
Calculation of Revised Debtors Balance to be shown in Balance Sheet

Debtors (as given in Trial Balance) 152,500

Less: Advance to Creditors (2,500)
Less: Provision for Bad Debt (7,500)
Less: Provision for Discount (3,563)
Debtors Balance to be Shown in Balance Sheet 138,938

2.
a) A, B and C were partners in a firm sharing profits and losses in the ratio of 2:2:1 respectively.
The Balance Sheet of the firm as on 31st Ashadh 2078 was as follows:
Amount Amount Amount Amount
Liabilities Assets
(Rs.) (Rs.) (Rs.) (Rs.)

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 Sundry
25,000 Cash 3,000
Creditors
Bills Payable 12,000 Sundry Debtors 20,000
Capital Less: Provision
1,000 19,000
Accounts for Bad Debts
A 40,000 Closing Stock 30,000
B 40,000 Furniture 10,000
Plant and
C 30,000 110,000 40,000
Machinery
Reserve 15,000 Buildings 60,000
Total 162,000 Total 162,000
On 31st Ashadh 2078, B retired. The terms of retirement provided the following:
i) The goodwill of the firm was to be valued at Rs. 20,000.
ii) Furniture, plant and machinery were to be depreciated by 10% and 5% respectively.
iii) Stock and building were to be appreciated by 20% and 10% respectively.
iv) Provision for doubtful debts was to be increased to Rs. 1,500.
v) The reserve was to be transferred to the capital accounts of the partners.
vi) The amount due to B was to be transferred to a separate loan account earning interest
@ 10% p.a.
Show the Revaluation Account, Partner’s Capital Accounts and the Balance Sheet of the
firm after B’s retirement. 10
Answer:
In the books of the Firm
Revaluation Account
Dr. Cr.
Particulars Rs. Particulars Rs.

To Furniture A/c 1,000 By Stock A/c 6,000

By Building
To Plant and Machinery A/c 2,000 6,000
A/c
To Provision for Bad Debts
500
A/c
To Partner's Capital A/cs
(A-Rs.3,400: B-Rs.3,400: C-
8,500
Rs.1,700)
12,000 12,000

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 Partner's Capital Accounts
Dr. Cr.
Particulars A B C Particulars A B C

To 10%
By Balance
B's Loan - 57,400 - 40,000 40,000 30,000
b/d
A/c
To
By Reserve
Balance 57,400 - 38,700 6,000 6,000 3,000
A/c
c/d
By Goodwill
8,000 8,000 4,000
A/c
By
Revaluation 3,400 3,400 1,700
A/c
57,400 57,400 38,700 57,400 57,400 38,700

Balance Sheet (After B's Retirement)

As on 31st Ashadh 2078
Capital &
Rs. Assets Rs.
Liabilities

Sundry
25,000 Cash 3,000
Creditors
Bills Sundry
12,000 20,000
Payable Debtors
Less:
10% B
57,400 Provision for 1,500 18,500
Loan A/c
Bad Debts
Capital Closing
36,000
Accounts Stock
A 57,400 Furniture 9,000
Plant and
C 38,700 96,100 38,000
Machinery
Reserve Buildings 66,000
Goodwill 20,000
190,500 190,500

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(b) Princy & Co. Ltd. obtained a lease of some coal bearing land from Amir & Co. Ltd. the terms
being a royalty of Rs. 15 per ton of coal raised subject to minimum rent of Rs. 75,000 per annum
with a right of recoupment of short workings over the first four years of the lease. From the
following details, you are required to prepare: 10
(i) Royalties Account
(ii) Short Workings Account; and
(iii) Amir & Co. Ltd.
Year 2074 2075 2076 2077 2078

Sale (tons) 2,000 3,500 4,800 5,600 8,000

Closing Stock (tons) 300 400 600 500 800

Answer:
Working Notes
1. Calculation of production and royalties

Year Sales Closing Opening Production (tons) Royalties

(1) Stock Stock (4)=(1)+(2)-(3) (Rs.)
(2) (3) (5)
2074 2,000 300 - 2,300 34,500
2075 3,500 400 300 3,600 54,000
2076 4,800 600 400 5,000 75,000
2077 5,600 500 600 5,500 82,500
2078 8,000 800 500 8,300 124,500
2. Analysis of Royalties Payable

Actual Shortworking
Royalties
Output @ Rs. 15 Minimum Written Amount
Year Tons per ton Rent Surplus Suffered Recouped Off C/F Payable
2074 2,300 34,500 75,000 - 40,500 - - 40,500 75,000
2075 3,600 54,000 75,000 - 21,000 61,500 75,000
2076 5,000 75,000 75,000 - - - - 61,500 75,000
2077 5,500 82,500 75,000 7,500 - 7,500 54,000 - 75,000
2078 8,300 124,500 75,000 49,500 - - - - 124,500

In the books of Princy & Co. Ltd

Royalties Account

Date Particulars Rs Date Particulars Rs.

(Dr) (Cr)
2074 To, Amir & Co. Ltd. 34,500 2074 By, Manufacturing A/c 34,500
2075 To, Amir & Co. Ltd. 54,000 2075 By, Manufacturing A/c 54,000
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 2076 To, Amir & Co. Ltd. 75,000 2076 By, Manufacturing A/c 75,000
2077 To, Amir & Co. Ltd. 82,500 2077 By, Manufacturing A/c 82,500
2078 To, Amir & Co. Ltd. 124,500 2078 By, Manufacturing A/c 124,500

Short Working Account

Date Particulars Rs. Date Particulars Rs.
2074 To, Amir & Co. Ltd. 40,500 2074 By, Balance c/d 40,500
A/c
2075 To, Balance b/d 40,500 2075 By, Balance c/d 61,500
To, Amir & Co. Ltd. 21,000
A/c
61,500 61,500
2076 To, Balance b/d 61,500 2076 By, Balance c/d 61,500
2077 To, Balance b/d 61,500 2077 By, Amir & Co. Ltd. 7,500
A/c
By, Profit & Loss A/c 54,000
61,500 61,500

Amir & Co. Ltd. Account

Date Particulars Rs. Date Particulars Rs.
2074 To, Bank A/c 75,000 2074 By, Royalties A/c 34,500
By, Shortworking A/c 40,500
75,000 75,000
2075 75,000 2075 By, Royalties A/c 54,000
To, Bank A/c
By, Shortworking A/c 21,000
75,000 75,000
75,000 75,000
2076 To, Bank A/c 75,000 2076 By, Royalties A/c 82,500
2077 To, Bank A/c 2077 By, Royalties A/c
To, Shortworking 7,500
A/c 82,500 82,500
2078 124,500 2078 By, Royalties A/c 124,500
To, Bank A/c

3.
a) From the following particulars, prepare a Bank Reconciliation Statement of Khetan
Enterprises to ascertain the balance as per Bank Statement as on 31st Ashadh, 2078:
i. On 31st Ashadh 2078, the Cash Book of Khetan Enterprises showed a bank balance of Rs.
650,000 (debit balance).
ii. Cheque has been issued for Rs. 50,000 out of which cheques worth Rs. 40,000 was
presented for payment.
iii. Cheques worth Rs. 140,000 were deposited in the bank on 30th of Ashadh 2078, but the
cheque had not been credited by the bank. In addition to this, one cheque for Rs. 60,000
was entered in Cash Book on 31st of Ashadh 2078, but was banked on 3rd Shrawan 2078
only.

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 iv. A cheque from Muskan Enterprises for Rs. 75,000 was deposited in the bank on 26 th
Ashadh 2078, but was dishonored and the advice was received on 2nd Shrawan 2078.
v. Pass Book showed bank charges of Rs. 2,000 debited by the bank.
vi. One of the debtor deposited a sum of Rs. 85,000 in the bank account for the firm on 22nd
Ashadh 2078, but the intimation in this respect was received from the bank on 3rd Shrawan
2078.
vii. Bank has charged Rs. 57,000 as interest but it was not recorded in Cash Book.
viii. Value added tax amounting to Rs. 33,000 was paid through the bank via online payment
gateway and 10% of such amount was refunded as cash back for online payment in bank
account which were yet to be recognized in cash book. 10
Answer:
Bank Reconciliation Statement as at 31st Ashad 2078
S. Plus Items Minus Items
Particulars
No Rs. Rs.
i. Bank Balance (Dr.) as per Cash Book 650,000

ii. Cheques issued but not yet presented for payment 10,000
iii. Cheques deposited but not yet credited by Bank 140,000
Cheque received and recorded in cash book but not
yet banked 60,000

iv. Cheuqe dishonored but not recorded in cash book 75,000

v Bank charge not recorded in cash book 2,000
Cheque deposited directly by customer not yet
vi.
recorded in cash book 85,000

vii. Interest Charged by bank not recorded in Cash book 57,000

Bank payment via online gateway yet to be recorded
viii.
in Cash Book 33,000
Cash Back for online payment 3,300
Bank Balance as per Bank Pass Book 381,300

b) What is contingent liability? How is it presented in financial statements? 5

Answer:
Nepal Accounting Standard on Provisions, contingent liabilities and contingent assets (NAS 37)
issued by The Institute of Chartered Accountant of Nepal defines contingent liability as:
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 • A possible obligation that arises from past event and whose existence will be confirmed
by the occurrence or non-occurrence of one or more uncertain future events not wholly
within the control of entity or
• A present obligation that arises from past event but is not recognized because:
➢ It is not probable that an outflow of resources embodying economic benefits will be
required to settle the obligation or
➢ The amount of obligation cannot be measured with sufficient reliability.
Further contingent liability should not be recognized in the books of entity but should be disclosed
in ‘Notes to accounts of the Financial Statements’.
Examples: Claims against entity not acknowledged as debt, guarantee given in respect of third
party, liability in respect of bills discounted etc.

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 Paper 2: Part A: Mercantile Laws
1. Answer the following questions:
a) Explain about the classification of partnership. 5
b) Mention the required matters for the application of the registration of Partnership firm?
5
Answer:
a) A partnership firm may be classified on the following two basis namely:
1) Based on duration: The partners are at liberty to fix the duration of the partnership. They
must fix any duration of the partnership or may retain silent about the same. On this basis,
the partnership may be of the following two kinds:
a) Partnership at will: It is partnership in which its duration is not fixed and can be
dissolved by any one partner at his will at any time. Thus, a partnership is at will in
the following two cases:
➢ Where the partnership is not for a fixed period of time. Or
➢ Where no provision is made as to when and how the partnership will come to an
end.
b) Partnership for a fixed period: It is a partnership in which its duration is fixed and
cannot be dissolved by any partner at his will. If a partnership continues to carry on
the business eve after the expiry of fixed period, the partnership becomes a
partnership at will.
2) Based on extent of business: The partners are also at liberty to carry on one or more
adventures or undertakings in a business.
a) Particular partnership: It is a partnership which is formed for the purpose of
carrying on the particular adventure or understanding.
b) General partnership: It is the partnership which is formed for the purpose of
carrying on business in general.
b) Application is the first step for getting a firm registered. By section 6 of the Act, the partners
must submit an application to the concerned department along with the prescribed fees
subject to the structure of capital for registration, that is, the amount of registration fees
depends on the amount of capital invested in the partnership business. The application should
be clearly filled and the language of the particulars should be simple.
According to the Nepalese Partnership Act, 2020, an application must be submitted to the
concerned department along with the fees prescribed in schedule 2(a) and the duty attested
one copy of the agreement, if any, concluded between the partners in format prescribed in
schedule 1(a) of the Partnership Act, 2020. The matters must be clearly mentioned in the
application, which are:
a. Full name of the firm
b. Main address of the firm

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 c. Brief particulars of the article or commodity which the firm wants to deal in or of the
service it seeks to render and its objects,
d. Full name and permanent address of the partners
e. Details of restriction if any, on the rights of any partners, made.
f. Types of partners and capital contributed by each partner
g. Name of partner or partners who represent the firm.
h. Method of sharing of profit or loss.
i. Methods of determining profit.
j. Any other particular as directed by the concerned department to be mentioned.

2. Answer the following questions:

a) Distinguish between Bailment and Pledge. 5
b) What are the obstacles of doctrine of unjust enrichment? 5
c) What are the special provisions relating to compensation for a contract of Sale of Goods? 5
Answer:
a)
Differs in Bailment Pledge

1. Purpose For some specific repair or lease or Provide as security for fulfillment
safe custody. of an obligation.
2. Security Under this, no security is required Under this, security is essential at
at the time of bailment. the time of pledge.
3. Right of Depends on the nature of The pledgee cannot use the goods
using the goods transaction or terms. pledged.
4. The bailment may be either Under pledge, consideration is
Consideration gratuitous or non-gratuitous. Thus, available to either party.
consideration may or may not be
available to either party.
5. Loan Under bailment, no loan Under pledge, loan transaction may
transaction transaction exists. exist.
6. Types of The bailment includes movable The pledge includes both types of
goods goods only. goods whether movable or
immovable.

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b) Obstacles or key issues that prevent the ability to gain restitution through unjust enrichment
under quasi-contracts include officiousness, acceptance, reasonable expectation, tortuous
conduct, and authority.

1) Officiousness. To officiously confer services is to enrich but not to unjustly enrich. If one
volunteers services or simply performs them at no request, compensation for those services
is not inferred.
2) Acceptance. Acceptance of the work performed, or services rendered should be made
before the owner is considered enriched. This gives the owner the freedom to reject or
accept the work performed by the contractor.
3) Reasonable Expectation. Reasonable expectation of compensation is another test that
justifies restitution under unjust enrichment and implied law. The circumstances under
which the services were rendered must reasonably show the intention and understanding
that the owner was to make payment to the contractor.
4) Tortuous Conduct. Full restitution of work performed by the contractor may not be
awarded if the owner’s conduct is not tortuous. If the owner is not at fault and has acted
reasonably, and if changes are such that the owner would suffer a loss in giving full
restitution, then full restitution may not be awarded.
5) Authority. Another potential problem area of which the contractor should be aware is the
authority of the party requesting services.

c) Section 561 of National Civil Code, 2074 states following provisions shall apply to
compensation for a contract of Sale of Goods:

1) If a buyer does not accept or rejects the goods or refuses to pay the price of the goods after
the making of a contract of the sale of goods, the seller may, subject to the contract, claim
compensation from the buyer in consideration of the buyer's failure to accept or refusal to
accept the goods.
2) While determining compensation under clause (a), if the goods which the buyer has not
accepted or has refused to accept are available in the market, compensation shall be
determined on the basis of the difference between the price of the goods specified in the
contract and the market or prevalent price of the goods,
3) If the seller does not deliver or refuses to deliver the goods according to the contract for the
sale of goods, the buyer may claim compensation from the seller for his or her failure to
deliver the goods,
4) While determining compensation under clause (c), if the goods which the seller has refused
or failed to deliver to the buyer are available in the market, compensation shall be
determined on the basis of difference between the price of the goods specified in the contract
and the market or prevalent price of the goods.

Page 16 of 37
Paper 2: Part B: Fundamentals of Economics
1. Long Answer Questions:

a) Define the average product and the marginal product. Explain the relation between the
average product and the marginal product. 5
b) Explain the problems of agriculture development in Nepal and suggest remedies for them.
5
Answer
1 a) An average product is the output per unit of the input. It is calculated by dividing total product
(TP) by units of the input employed. The average product of different inputs is calculated
TP
separately. The average product (APL) of labor (L) is calculated as: APL = L . Similarly, the
TP
average product (APK) of capital (K) is calculated as: APK = K .
A marginal product is the addition made to total product by employing one more unit of the
input. It is the ratio of the change in total product (∆TP) with the change in units of the input.
∆TP
The marginal product (MPL) of labor is calculated as: MPL= ∆L . Similarly, the marginal
∆TP
product of capital (MPK) is calculated as: MPK = ∆K .
Relation between AP and MP
When the average product increases, the marginal product also increases and increasing rate
of MP is greater than AP. Both AP and MP curves slope upwards to the right, but the MP
curve lies above the AP curve. When the average product decreases, the marginal product
also decreases but decreasing rate of MP is less than AP. Both AP and MP curves slope
downwards to the right, but the MP curve lies below the AP curve. When the average product
reaches maximum, marginal product becomes equal to the average product. Here, the
marginal product curve cuts the average product curve at maximum point of average product
from above.
The relation between average product and marginal product is explained by following table
and figure.

Units of labor Total Product Average Product Marginal Product

0 0 0 –
1 10 10 10
2 30 15 20
3 60 20 30
4 80 20 20
5 90 18 10
6 90 15 0
7 80 11.4 –10

Page 17 of 37
 Y

Average and marginal product 30 •

24
20 • • •
15 • •
• AP
10 • •
5
O • X
–10
1 2 3 4 5 6 •7MP Labor Input

In above table and corresponding figure, when AP is increasing up to 4 units of labor, MP is

greater than AP. At 4 units of labor MP and AP are equal. When AP is decreasing after 4
units of labor, MP is less than AP. The maximum point of MP is at 3 units of labor which
comes before the maximum point of AP i.e. at 4 units of labor.
1b) Nepalese Agriculture is in a low development stage. Productivity and competitiveness of the
agriculture sector are low, adoption of improved technology is limited, and most cultivated
area is devoted to cereals. The main problems of Nepali agriculture are as below:

1. Insufficient agriculture finance

Nepali agriculture has problem of investment due to insufficient finance. Farmers are poor
and cannot investment by themselves. Financial institutions hesitate to invest in
agriculture sector due to lack of assurance of return of the investment. In addition, rural
farmers do not have easy access to such urban centered financial institutes. As a result,
they are compelled to get loan from informal sector at high rate of interest.
2. Lack of entrepreneurship
Due to the dominance of illiterate farmers, there is lack of goods skills and
entrepreneurship in Nepalese agribusiness. Nepali farmers do not have risk taking
capacity and innovation skills. As a result, productivity is low.
3. Subsistence agriculture
Nepalese farmers produce agro-output for subsistence. Commercial, collective and
cooperative farming is limited. The principal end of the Nepalese farmers is to get the
means of subsistence possible which is the problem for agriculture development.
Subsistence farming hinders specialization and use of modern technology which
ultimately leads to low productivity and high cost of production.
4. Low productivity
Nepalese agriculture is characterized by low productivity. In respect of output per hectare
of land, agricultural productivity in Nepal is far below the level of agricultural productivity
in developed countries. The food grain production per hectare was mere 1.85 because of
the use of primitive technology. Low per capita income and small land holdings are
responsible for the low productivity of Nepalese agriculture.
Page 18 of 37
5. Small size of land holdings
Land holdings of the farmers in Nepal are very small and have mostly been fragmented
over the years. From such an ´uneconomic` land holding, good increase in agricultural
productivity cannot be expected. The average size of land holdings for Nepal is below one
hectare. The possibility of mechanization and modernization of agriculture is almost a
dream. As a result, the agricultural productivity of agriculture has not increased.
To overcome the above mentioned problems, following steps should be applied for
agriculture development.
1. Provision of agriculture finance and insurance
Farmers need finance to invest in agriculture but bank and finance institutions are not
ready to invest in agriculture due to low rate of return and high risk in this sector. So,
government has to create environment to increase investment in agriculture sector by bank
and financial institutes at low rate of interest with easy access. Agricultural production is
risky process as it is highly dominated by nature. Agricultural insurance should be
promoted so that farmers have access to viable crop, livestock and fishery insurance
products.
2. Development of infrastructure and technology
Agricultural productivity is low due to lack of basic infrastructure and lack of modern
technology. Basic infrastructure like agriculture road, irrigation, electricity, market place,
cold store, warehouses should be developed which increases productivity of agriculture
sector. Similarly, technological advancement in cultivation process, livestock farming as
well as in use of inputs increases productivity of agriculture sector. Government should
ensure the availability of quality agricultural inputs like machinery, modern seeds,
fertilizers, pesticides timely at affordable price.
3. Development of market system
The agricultural market system refers to the system through which agricultural products
reach to consumers’ tables from farmer's field. Without developed market system the
agriculture product cannot be sold at competitive price and farmers cannot get profit. To
develop the system price of agriculture product should be determined; value chain should
be developed; influence of middle man should be reduced by supply chain management
and agriculture market information centers should be establishment at grassroots level.
4. Research and agriculture education
Agriculture research is must for development of agriculture sector because cropping and
livestock farming patterns appropriate to ecological conditions can be adopted only after
the research. The research works should be conducted at farmers' level of the country to
identify suitable approach of agriculture. A comprehensive package of measures should
be developed to ensure closer integration with research and extension, improved capacity
of the university, agricultural colleges, and vocational schools, and better response to the
needs of farmers and agro-enterprises.

Page 19 of 37
 5. Land reform
The fragmentations of land and dual ownership on land have been affecting badly the
agricultural productivity in Nepal. Land reform should include land use planning, land
fragmentation, land tenure, land ceiling, land pooling etc. Concept of 'Land Bank' can be
introduced for land pooling. The Land Bank provides intermediation between owners of
land and prospective renters of land. The Bank guarantees the right of the owners and
facilitates long-term leasing of land by private individuals, cooperatives, or private
enterprises.

2. Short Answer Questions (Any Five):

a) Explain the concept of individual and market demand curves with the help of table and
diagram. 3
b) “Micro economics has a great significance in business decision”. Give three reasons. 3
c) What is the meaning of the international trade? Explain any four reasons for arising the
international trade. 3
d) Define perfect competition market. Mention its four features. 3
e) What is the average and marginal cost. Illustrate their relationship. 3
f) Define income elasticity of demand. Calculate income elasticity of demand for milk by
using average method in following income demand schedule and explain the nature of
milk. 3
Income of consumer Quantity demanded for milk (Liter)
40,000 30
60,000 40
Answer
2 a) The demand curve which shows quantity demanded of a commodity by a particular consumer
at various prices is known as individual demand curve. On the other hand, the demand curve
which shows the sum total of quantity demanded of a commodity by all consumers of the
market at various prices is known as market demand curve. The market demand curve is
derived by the horizontal summation of all individual demand curves. The individual and
market demand schedule as well as figure are presented below:
Quantity Demanded (in units) by
Price Market Demand (A + B +
Individual
(in Rs.) C) in units
A B C
10 30 25 20 75
20 20 15 10 45
30 10 5 0 15

Page 20 of 37
 DC

O X
5 10 15 20 25 30 35 40 45 50 55 60 65 70 75
Quantity

On the basis of the demand schedule, individual demand curves for A, B and C are derived
as DA, DB and DC respectively. The horizontal summation of these individual demand curves
is the market demand curve which is represented by the curve DM.

2 b) Microeconomics is the study of how individuals and firms makes decisions of use for scarce
resource. Such individual decisions affect market and the entire economy. Almost all the
businessman does the decision based on the knowledge of micro economics andmicro
economics has a great significance in business decision. The reasons are:
1. Optimal Resource Allocation
Business firms have limited or scarce economic resources by which they are facing the
problem of optimization, i.e. output or profit maximization or cost minimization. Hence,
they will have to make optimum allocation of resources to achieve their goals.
Microeconomics also helps the business firms to select highly efficient and least cost
production technique with the application of tool of linear programming, input-output
analysis, etc.
2. Basis for Prediction
Microeconomic theories establish cause and effect relationships between two or more
than two economic events. It also provides the basis for predicting the future course of
economic events. Microeconomic theories are of great importance in the planning of the
future course of economic activities alone by individuals, business firms and the
government. For example, microeconomics states that the fall of the demand for a
product comes out with the raise of the price. This type of prediction indicates the future
trend of price. Such predictions help the policy-makers to formulate polices regarding
prices of commodities.
3. Price Determination
Microeconomics is useful in pricing (product pricing and factor pricing) through
demand-supply model. The model states that price is determined by the forces of demand
and supply, and at equilibrium price, the quantity demanded equals quantity supplied.
Similarly, firm under monopoly and monopolistic competition, determines product price
and factor price on the basis of law of demand, opportunity cost, elasticity of demand,
etc.

2 c) Exchange of goods and services across international boundaries is called international trade.
It is economic transactions that are made between countries. Thus, international trade is the
exchange of goods and services from one country to another. Export and import are main
two components of international trade. Export refers to the situation where a country supplies
its goods to other countries and import refers to the situation where a country demands goods
from other countries. International trade creates specialization in the production and provides
benefits of specialization. International trade plays an important role not only to fulfill the
demand but also in the economic development of a country. Reasons for arising international
trade are as follows:

Page 21 of 37
 1. Differences in Technology
International trade can occur between countries if the countries differ in their
technological abilities to produce goods and services. Technology refers to the techniques
used to turn resources (labor, capital, land) into outputs (goods and services).
2. Differences in Resource Endowments
International trade can occur between countries if the countries differ in their endowments
of resources. Resource endowments refer to the skills and abilities of a country’s
workforce, the natural resources available within its borders (minerals, farmland, etc.),
and the sophistication of its capital stock (machinery, infrastructure, communications
systems).
3. Differences in Demand
International trade can occur between countries if demands or preferences differ between
countries. Individuals in different countries may have different preferences or demands
for various products.
4. Existence of Economies of Scale in Production
The existence of economies of scale in production is sufficient to generate advantageous
trade between two countries. Economies of scale refer to a production process in which
production costs fall as the scale of production rises. This feature of production is also
known as “increasing returns to scale.”
5 Existence of Government Policies
Government tax and subsidy programs alter the prices charged for goods and services.
These changes can be sufficient to generate advantages in production of certain products.
In these circumstances, advantageous trade may arise solely due to differences in
government policies across countries.
6. Difference in currency
Different countries use different types of currency for exchange in domestic market but in
international trade all domestic currencies are not acceptable for all countries. Thus the
nature of international trade is different than domestic trade which causes for arising
international trade.

2 d) Perfect competition is a market structure characterized by completely absence of price rivalry

among the individual firm. The perfect competition is the market structure where there are
large number of buyers and large number of sellers. Under the perfect competition market,
the price of the product is determined by the interaction between demand and supply. The
industry is the price maker and firms are the price taker. The buyers and sellers have the
perfect knowledge about the market. The only one buyer and seller cannot influence the
price of the product. There is homogeneous product. There is not an intervention of the
government.
In practical life, perfectly competitive market is a rare phenomenon. This kind of market is
therefore created by assumption for theoretical purpose.
Features/ Characteristics of perfect competition
a. Large number of buyers and sellers: -
There are large number of buyers and sellers in the market and they can buy and sells
the goods freely without any pressure in the market. So, each and every buyer tries to

Page 22 of 37
 maximize his satisfaction from the goods which he purchases and seller tries to
maximize its profit to sell the more products in the market.
b. Homogenous Product: -
In the market goods produced are of homogenous in character. There is not
distinguished between the product of one firm to another firm in terms of price, quality,
size, quantity etc.
c. Perfect knowledge: -
The sellers and buyers are perfect knowledge about the market. They know about the
present and future conditions of the market in regard of price of commodity. As a result
neither seller can charge higher price nor would consumer ready to pay more than the
market price in any condition.
d. No government intervention: -
Under this market there is free market environment and no any government regulation
to private sector in any business decision making process.
e. Free entry and exit: -
The firm can enter and exit from industry there is no barrier. If firm incurring losses
leave the industry and when there is profit the new firms enter into the industry. The
firms only earn normal profit in the long run.
f. Price cannot be influenced by a single firm: -
In a perfect competition market structure, the market price cannot be influenced by the
single firm.
g. Perfect mobility of the factors of production: -
The factors of production are freely mobility according to their opportunities. If factor
get the more opportunities, it can be mobilized from one place to another place.

2 e) Average Cost (AC) is defined as the total cost divided by level of output, i.e., Per unit cost
of a good is AC.
TC
AC = Q

Marginal cost (MC) is defined as the change in TC due to change in level of output,
i.e. cost needed to produced additional unit is MC.
TC
MC =
Q

Page 23 of 37
 We can present both AC and MC in the following figure.
AC, MC

MC AC

a
•
Minimum
• point of AC
b
O Q
With the help of the figure above, we can derive the
following relationships between AC and MC:
a. Both AC and MC are derived from same sources Total Cost (TC) and level of output
(Q) with the difference that MC needs change in TC and Q.
b. Both are U-shaped due to law of variable proportions.
c. When AC falls, MC also falls but rapidly. Thus to the left of minimum point of AC, AC
> MC.
d. When AC increases, MC also increases but rapidly. To the right of minimum point of
AC, AC < MC.
e. MC always cuts AC at its minimum point. At minimum point of AC i.e. at a, AC =
MC.
2 f) Income elasticity of demand is the degree of responsiveness of change in demanded of
commodity to the change in the income of the consumer. Income elasticity of demand is
defined as the ratio of percentage change in demanded for a commodity to the percentage
change in income of the consumer.
𝑃𝑒𝑟𝑐𝑒𝑛𝑡𝑎𝑔𝑒 𝑐ℎ𝑎𝑛𝑔𝑒 𝑖𝑛 𝑑𝑒𝑚𝑎𝑛𝑑𝑒𝑑 𝑜𝑓 𝑎 𝑐𝑜𝑚𝑚𝑜𝑑𝑖𝑡𝑦
Income elasticity of demand (ey) = 𝑃𝑒𝑟𝑐𝑒𝑛𝑡𝑎𝑔𝑒 𝑐ℎ𝑎𝑛𝑔𝑒 𝑖𝑛 𝑖𝑛𝑐𝑜𝑚𝑒 𝑜𝑓 𝑐𝑜𝑛𝑠𝑢𝑚𝑒𝑟

Q2 - Q1 Y1+ Y2
We know, in average method, income elasticity of demand (ey) =Y - Y × Q + Q
2 1 1 2
Here Y1 = 40000 Y2 = 60000
Q1 = 30 Q2 = 40

40 - 30 40000+60000
ey = 60000 - 40000 × = 0.71
30+40
Here, income inelasticity of demand is 0.71 which implies that 1% increase in income of a
consumer leads 0.71% increase in demanded for the milk, vice versa.
Since ey>0, the milk is a normal good and ey<1 it has relatively inelastic demand and it is
basic necessity for life.

Page 24 of 37
Paper 3: Part A: Fundamentals of Management
1. Long Answer Questions: (2×5=10)
a) Explain decision making. Discuss the process involved in decision making. 1.5+3.5=5
b) What do you mean by the term HRM? Why it is important? 1.5+3.5=5
Answer 1(a)
Decision making is the process of recognizing the problem, analyzing the problem, generating
alternative, evaluating and choosing the best alternative for execution. Decision making is focused
on problem solving and/or opportunity utilization.
Process of decision making:
(a) Recognizing the problem:
The first step in the decision making process is recognizing situations in which a decision is
needed because an opportunity, a problem or crisis exists. In most cases, defining the problem
is not an easy task, opportunities and problems are not obvious. What at times might appear to
be the real problem might at best be simply the symptoms of the problem. Focusing at the
periphery are wasteful efforts and are the premature decision making
(b) Analyzing the problem:
In this stage, the decision maker gathers facts and looks for advice. He collects as many facts
as he can and tries to separate facts from beliefs, opinions and preconceived notions. Each item
is carefully evaluated, its validity judged, irrelevant data will be discarded. The whole exercise
helps in ensuring background information and essential data relating to the problem defined
earlier.
(c) Generating alternatives:
Normally a business problem can be solved in many ways. If there is only one alternative, no
decision is required. But in any rational decision making process he manager should not jump
on to single proposal without considering all the alternatives. At this stage, the decision maker
searches for existing alternatives, modifies them and designs custom-tailored alternatives as
required.
(d) Evaluating alternatives:
The search for alternatives is not an unending process. The entire range of alternatives cannot
be expressed in black and white, there is a cutoff point. Once this point is reached the decision
maker should weigh alternative solutions against one another. All pertinent facts must be
collected, they must be classified, the pros and cons must be considered and the important facts
must be distinguished.
(e) Choosing the best alternative
Now the decision maker selects one best alternative judging from various angles like profit,
cost, product, manpower, quality etc. It is time consuming process.
(f) Implementation & Feedback
Next steps of decision making involves implementing the decision and making sure that the
selected decision meets the expected outcomes. Decision making is a continuous process, hence
a feedback from all the parties involved with implementing the decision is taken. Feedback may
reveal another problem created due to implantation or hindering effective implementation,
which may call for new decision.
Page 25 of 37
Answer 1(b)
Human Resource management is concerned with people management in organization for the
achievement of desired goals in effective and efficient manner. It is defined as a process of
recruiting, hiring, deploying and managing an organization's employee.
According to Edwin Flippo - Human Resource Management as “planning, organizing, directing,
controlling of procurement, development, compensation, integration, maintenance and separation
of human resources to the end that individual, organizational and social objectives are achieved.”
Human resources management is a very important function in every organization. Without it,
companies would not be able to effectively recruit and retain employees, improve and enhance the
organization, and they wouldn't be able to maintain a healthy, accepting workplace culture and
environment. Moreover, HRM is importance due to following reasons.

i) Increase productivity and profit

Human resource management ensures right quality and quantity of personnel in workplace.
Moreover, it creates opportunities to facilitate and motivate individual and group of employees
to grow and advance their career. Motivated employees work hard to meet their personal career
goal which directly influences productivity of organization. Minimizing cost and maximizing
profit is the essence of productivity.
ii) Produce employees who are easily adaptable to change
Human resource management performs various functions. Among which training and
development of employees is one of the vital ones. Training and development programs keep
employees updated with skills necessary to adjust with alteration of organization’s environment,
structure and technology.
iii) Match demand and supply of human resource
Human resource management probes existing human resource in certain interval of time to
identify if the company has adequate number of workers or not. In case when company has
inadequate human resource, human resource management performs activities like recruitment
and selection to balance the need. In the same way, it lays-off inefficient employee in case when
the company has excessive employees.
iv) Retain employees and motivate them to accomplish company’s goal
Utilizing human resource as per their capability and maintaining them in the company for a long
term is a major function of human resource management. Under this function, HRM performs
tasks like providing fringe benefits, compensation and rewards to the deserving employees.
These activities do not only help in retaining employees in the company but also in achieving
organization’s goal effectively.
v) Goal Harmony
It helps to maintain compatibility between individual, group, Organizational and societal goal.
Vi) Employee retention
It helps to retain employee because HRM focuses on employee well being and their satisfaction.

Page 26 of 37
Vii) Quality of work life
Employee’s recognition, their facilities and overall development is ensured through human
resource management.

2. Short Answer Questions (Any Five): (5×3=15)

a) Social responsibility towards the consumers.
b) Types of control.
c) Explain upward and down communication.
d) Explain tall and flat nature of organization structure.
e) Define the term delegation of authority and decentralization of authority.
f) Define physical and financial resources of organization.
Answer 2(a)
Social responsibility towards the consumers:
• To serve as a friend and guide by providing prompt and courteous service,
• Providing goods of quality at reasonable prices,
• Avoiding false, exaggerated advertisement and high pressure publicity,
• Management should not indulge in antisocial activities like black marketing, hoarding etc.
• To ensure regular and adequate supply of goods particularly during period of shortages,
• To ensure a fairly wide distribution among all sections of consumers,
• To disseminate useful information to consumers about the company, new products and
services,
• To provide goods of proper quality which provide more satisfaction to consumers.
Answer 2(b)
Types of Control
Control are of following types:
1. Historical (Feedback) control
2. Concurrent control
3. Predictive (feed forward) control

1. Historical (Feedback) control: Most of the time control is called historical as the control
measures the result after the performance. Control provides information as to how the goals of
the organization are met or not. Here the control is seen as a post-mortem of events the purpose
of which is to improve in the future.
2. Concurrent control: It is also called as real time control or steering control, refers to considering
immediately any problem and analyse it to take necessary and corrective steps before any major
damage is being done. Control chart is an example.

Page 27 of 37
3. Predictive control: Here the control system anticipates the problem and take the corrective
action. It is also called as feed forward control, attempts to anticipate problem or deviation from
the standard in advance of their occurrence. It is more aggressive approach to control allowing
corrective action to be taken in advance of the problem.
Answer 2(c)
The flows of message or information from subordinates to superiors in the organization is known
as upward communication. Generally, information of achievement of work done, problems faced
in performance, suggestion, grievance etc. are communicated from the lower level to the upper
level. Such information enables the management to know what is actually happening in all
departments of organization.
The flow of information from superior to subordinates in the management hierarchy is known as
downward communication. Basically information of instruction, plans, policies and direction
formally flows from the upper level to the lower level. Such information is essential to maintain
regular operation of the enterprises and to meet planned objective.
Answer 2(d)
Tall organization structure:
Tall hierarchies have many layers of management. There is clear chain of command from top level
to subordinate level in managerial hierarchy. No one can violate the scalar principle. Upper level
commands immediate subordinates and each subordinate reports immediate superior during
official activities. It fosters effective communication of information, reduce confusion, and
misunderstanding in an organization.
On the other side, several problems may occur in tall hierarchies that may result in lower
organizational efficiency and effectiveness. There is a tendency for information to get accidentally
distorted as it passes through layers in a hierarchy. Communication may be slow and distorted.
Flat organization structure:
Flat hierarchies have few layers and wide span of control. Most firms start out small, often with
only one or at most two layers in the hierarchy. Flat structure encourages empowerment of
employees and allows them greater sense of responsibility and autonomy. It is suitable for small
nature of organization. There is high level of decentralization. Close and personal supervision of
top level management encourage team spirit to solve organizational issues.

On the other side, if it is too short or flat, span of control increases and hence effective supervision,
control and coordination cannot be ensured. Hence, large size of the organization does not suit
flat organizational structure.
Answer 2(e)
Delegation of authority is a downward process by which formal authority is transferred to
subordinates for completion of specific job. It consists of assigning duties and responsibilities,
granting authority and creating accountability to subordinates. It is the means for getting the job
done through others.
Whereas authority decentralization is delegation of decision making power downward. It may be
of administrative and geographical. Administrative downward refers delegation of decision
Page 28 of 37
making power to lower levels and geographical downward refers delegation of authority in
regional, district and village level offices.
Answer 2(f)
Physical resources are the tangible resource used to operate the organization, such as land,
building, production machinery, supplies for final product, transportation, and overhead such as
internet and electricity. Whereas financial resources are money available for spending. Typically,
this includes cash, liquid assets, equity funding and loans.

Page 29 of 37
Paper 3: Part B: Commercial Mathematics and Statistics
1.
a) A company sets aside a sum of Rs. 1,70,000 annually for 10 years to pay off a
debenture issue of Rs. 20,00,000. If the sinking fund accumulates at 8.5% p.a. C.I.,
find the surplus after the full redemption of the debenture issue. 4
b) In a correlation study the following values are obtained:
X Y
Mean 65 67
Standard Deviation 2.5 3.5
Correlation 0.8
Coefficient
Find the two
regression equations that are associated with the above values. 4

c) An enquiry into budgets of the middle-class families in a certain city gave the
following information:
Expenses on: Food Fuel & Lighting Clothing Rent Misc.
35% 10% 20% 15% 20%
Price in 2021(Rs.): 150 25 75 30 40
Price in 2022 ( Rs.) 145 23 65 30 45
What is the cost of living index number of 2022 as compared with that of 2021? 4

d) The following table gives the frequency distribution of marks obtained by the
students of two classes.
Marks: 0 – 10 10 – 20 20 – 30 30 -40 40- 50 50 – 60
Class A: 10 18 32 40 22 18 = 140
Class B: 18 22 40 32 18 10 = 140
Find which class has more uniformity in marks. 4
Answer:

a) Annual deposit (P) = Rs. 1,70,000

Number of years (n) = 10
Rate of interest (r) = 8.5%
r 8.5
∴ i= = = 0.085
100 100
We know,
P
Amount of annuity = [(1 + i)n − 1 ]
i
1,70,000
= [(1 + 0.085)10 − 1]
0.085
= 20,00,000 [(1.085)10 − 1] ... ... ... (i)
Let, x = (1.085)10
Page 30 of 37
 Taking log on both sides, we get
Logx= log(1.085)10
= 10 log (1.085)
= 10 × 0.0355
= 0.355
So, x = antilog (0.355) = 2.265
∴ (1.085)10 = 2.265
Putting the value of (1.085)10 in (i), we get
Amount of annuity = 20,00,000 (2.265 – 1)
= 20,00,000 × 1.265
= 25,30,000
Amount of annuity = Rs. 25,30,000
Surplus = Rs. (25,30,000 – 20,00,000) = Rs. 5,30,000
b) Regression Equation of x on y is

σx
x − x̅ = r (y − y̅)
σy
x̅ = 65
r = 0.8
σx = 2.5
σy = 3.5
y̅ = 67

2.5
x − 65 = 0.8 (y − 67)
3.5
x − 65 = 0.5714(y − 67)
x = 0.5714y − 38.28 + 65
x = 26.72 + 0.5714y

Regression equation of y on x,

σy
y − y̅ = r (x − x̅)
σx

Page 31 of 37
 3.5
y − 67 = 0.8 (x − 65)
2.5

y − 67 = 1.12(x − 65)

y = 1.12x − 5.8

c) Construction of cost of living Index

Base year price Current year p1

Item P= *100 W PW
P0 price P1 P0

Food 150 145 96.67 35 3383.45

Fuel & Lighting 25 23 92 10 920
Clothing 75 65 86.67 20 1733.4
Rent 30 30 100 15 1500
Misc. 40 45 112.5 20 2250

∑W= 100 ∑PW = 9786.85

=
 PW =
9786.85
= 97.87
Cost of living index number W 100

d) Computation of coefficient of variation.

Class A Class B
Marks M u=(m-25)/10 f1 f1u f1u2 f2 f2u f2u2
0 – 10 5 -2 10 -20 40 18 -36 72
10 – 20 15 -1 18 -18 18 22 -22 22
20 – 30 25 0 32 0 0 40 0 0
30 – 40 35 1 40 40 40 32 32 32
40 – 50 45 2 22 44 88 18 36 72
50 – 60 55 3 18 54 162 10 30 90
Total 140 100 348 140 40 288

∑ f1 u 100
For Class A, ̅̅̅
X1 = A + xc = 25 + x10 = 32.14
N 140
∑ f1 u2 ∑ f1 u 2 348 100 2
And, σ1 = √ −( ) x c = √140 − (140) x10 = 14.05
N N
σ1 14.05
And, CV = ̅̅̅̅
x 100 = x 100 = 43.71%
X 1 32.14

Page 32 of 37
 ∑ f2 u 40
̅̅̅2 = A +
For Class B, X xc = 25 + x10 = 27.86
N 140
∑ f2 u2 ∑ f2 u 2 288 40 2
And, σ1 = √ −( ) x c = √140 − (140) x10 = 14.05
N N
𝜎1 14.05
And, CV = ̅̅̅̅
𝑥 100 = 𝑥 100 = 50.43%
𝑋1 27.86

The students of class A has more uniformity in marks because CV(A)<CV(B).

2.
a) The odds are 9 to 5 favour a person P who is 55 years living till he is 75 years and 8
to 6 against another person Q who is 65 years living till he is 85 years. Find the
probability that (a) both of them will alive after 20 years (b) only one of them will
alive after 20 years. 3
b) If the sum of three consecutive terms in a G.P. is 19 and their product is 216. Find the
numbers. 3
c) There are 10 questions in an examination. In how many ways can be chosen 8
questions to answer. If question number 1 and 2 are compulsory, in how many ways
can be chosen the 8 questions? 3

Page 33 of 37
Answer:

a) Let the three Consecutive numbers in G.p. be a/r , a, ar

By question, we have
a
XaXar = 216
r

or a3 = 216

Page 34 of 37
 Or a = 6.
a
Again +a+ar = 19
r

1
or a ( r + 1 + r) = 19

6(1+r+r2 )
or = 19
r

or 6 + 6r + 6r 2 = 19r

or6 r 2 − 13r + 6 = 0

Or (3r-2)(2r-3)=0
2 3
∴ r = 3,r = 2

When r=2/3 , a= 6 then three numbers are 9, 6, 4.

When r= 3/2 , a=6 then three numbers are 4, 6, 9

b) Case - I
Total number of questions, n = 10
Number of questions to be selected, r = 8
Hence total number of ways to select the question is,
10!
10C8 = (10−8)!∗8! = 45
1.5
Case - II
Total number of questions, n = 10-2 =8 [ since two questions are compulsory]
Number of questions to be selected, r = 8 -2 = 6
Hence, required number of ways is,
8!
8C6 = (8−6)!∗6! = 28

Page 35 of 37
Examiner’s Commentary on Students' Performance in June
2022 Examinations
Subject: Fundamentals of Accounting

Questions Specific Comments on the Performance of the Students

Question no. 1 a. Most of the students solved the question, confusion has seen on
calculation of provision for debtors, depreciation, and purchase
value.
Question no. 2 a. Satisfactory performance.
b. Some of the students are confused on calculation production unit and
in ledger what is debit and what is credit.
Question no. 3 a. Satisfactory performance.
b. Satisfactory performance.

Subject: Mercantile Laws

Questions Specific Comments on the Performance of the Students

Question no. 1 a) Students were confused with the types of partners.
b) Satisfactory performance
Question no. 2 a) Satisfactory performance
b) Students’ performance was not satisfactory.

Subject: Fundamentals of Economics

Questions Specific Comments on the Performance of the Students

Question no. 1 a. Students were confused about figure of AP and MP and their
relation.
b. Students’ performance was not satisfactory.
Question no. 2 a. Satisfactory performance
b. Satisfactory performance
c. Students were confused on mutual benefit.
d. Proper explanation was not given about features.
e. Students were confused about figure of AP and MP and their
relation.
f. Satisfactory performance.

Page 36 of 37
Subject: Fundamentals of Management

Questions Specific Comments on the Performance of the Students

Question no. 1 a. Students’ performance was not satisfactory.
b. Satisfactory performance.
Question no. 2 a. Students’ performance was not up to the standard.
b. Satisfactory performance.
c. Few students explained opposite meaning with upward
communication and downward communication.
d. Lack of conceptual knowledge.
e. Some students could not differentiate between delegation and
decentralization.

Subject: Commercial Mathematics and statistics

Questions Specific Comments on the Performance of the Students

Question no. 1 Some students did not know the concept about coefficient of variance, two
regression equations. It seems students need more practice.
Question no. 2 Some students have lack of knowledge about probability and consecutive
terms. They did not differentiate permutation and computation.

Page 37 of 37