Professional Documents
Culture Documents
viii)
a)
b)
c)
d)
xvi)
When an insurance company restores the insured to the original financial position, this is
called:
a) Indemenity
b) Insurable interest
c) Proximate cuase
d) Subrogation
xvii) Unquoted companies means:
a) Amount paid out of the profit of the business to its shareholders depends on the number
of shares
b) Companies whose shares are bought and sold on the stock exchange
c) Companies whose share are not traded on the stock exchange
d) Conversion of undistributed profits into share capital.
xviii)
a)
b)
c)
d)
xix)
Advertising is important because it mainly:
A. Reduces the price of goods.
B. Induces customers to buy goods that have minor defects.
C. Creates employment.
D. Creates demand for goods and services.
xx) In a textile factory which of the following items may be classified as land?
A. Raw cotton.
B. Machinery
C. Wealth.
D. Lint.
SECTION B: (COMPULSORY)
Question 2
Read the following passage and answer the questions that follow
The provision of rural infrastructure has provided significant positive impact in many
emerging Asian economies as indicated by increased agricultural out-put productivity and
development for farm activities.
Market oriented incentives for agriculture and nonfarm activities are found to be necessary to
induce and maximise supply response. To do so government should intervene where markets
have failed, particularly in the area of infrastructure. Although infrastructure alone can both
induce economic growth its absence is likely to cause some constraints.
These are important lessons for Uganda policy on liberalisation of agricultural markets and
strategy for rural investment aimed at poverty reduction and economic growth. Recent changes
in agricultural markets should continue with restructuring of some processing industries,
Question 3
You have been at UMA Trade Fair Exhibition held at UMA show grounds between 2-10 October
2011. As a sales representative of a computer company. several orders were placed and you
got the best stall award.
REQUIRED
Write a short report to your company about the proceedings of the proceedings of the exhibition.
Include the following:
(15 marks)
Memo
To: Sales manager; MCL Computers Ltd
From: Ambrose Tubenawe; Sales representativesign
Date: 31st October 2011
Re: Summary report on UMA 2011 Trade Fair Exhibition
Introduction
Our company participated in this years UMA trade fair exhibition at UMA show grounds from 2nd
to 10th October 2011. I was a sales representative for our company at this exhibition. Anumber of
products were exhibited and many people turned up to our stall and pressed order as listed in
the table below:
Product
Purchases made
Orders made
Antivirus software
1000
200
300
Desk tops
1200
250
350
Lap tops
1000
100
400
LCD Projectors
400
10
50
Recommendations:
Question 4
As the human resource assistant in your organisation, you are requested to seek for qualified
persons to take on the job of the Chief Accountant
Required:
Design an advertisement to be published in the news paper daily specifically stating the
qualification required and the terms of employment.
Question 5
You are the office manager for Smart System, ltd, a start-up IT firm in Kampala (22/F,
Linkage Building, 188 Luwum Street). Recently you bought 10 modems from
Precision Supplies, a computer hardware supplier in Wanchai (12/F, Parkview Building, 276
Nairobi Road, Kenya). Two weeks after installing the modems to the computer systems
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in your office, you discovered that two of the modems could not function properly. Since
you have already paid the full amount for the modems, you are entitled to enjoy the two-year
warranty that comes with the product including free replacement for any products bought
within one month.
You called their customer service department to ask for a replacement last Friday and was
told that the replacement would be delivered to your office the following Monday. It is now
already Friday and you still have not heard anything from them. You really need the two
modems immediately for your company is working on a major project with an approaching
deadline. This is the first time you have ordered from Precision Supplies and may be the last.
REQUIRED:
Write a letter of complaint to demand for an immediate replacement or a full refund.
SMARTSYSTEM, INC.
22/F, Linkage Building
188 Luwum Street, Kampala
Uganda
Tel. 2345-2345
Fax. 2345-5432
31ST October, 2011
The Manager
Customer Services Department
Prescision Supplies
12/F, Parkview Building
276 Nairobi Road, Kenya.
Dear Sir/Madam
RE: COMPLAINT ON DELAY IN REPLACEMENT
We bought 10 modems from Precision Supplies about three weeks ago ( invoice number 1234).
We installed the modems in our offices computer system, and they seemed to be running
smoothly until last Friday when two of the modems began to refuse taking any command
signals.
Discovering the malfunction, we called your customer service department immediately asking
for replacements and were told that these would be delivered the following Monday. It is now
already Friday and we still have not heard anything from you. This has caused us great
inconvenience and delay in our work. The absence of the two modems has caused us a big
drop both in productivity and efficiency. We really need the two modems immediately as our
company is working on a major project with an approaching deadline. We face with heavy
penalties should the project fail to be completed on time.
Therefore, we cannot afford to continue working without the two modems. To make matters
worse, we could also lose a very valuable customer should we fail to meet the deadline. Having
paid the full amount for the modems, we have been informed that SmartSystem is entitled to the
two-year warranty that comes with the product including free replacement for any products
bought within one month.
This is the first time we have bought anything from Precision Supplies. We ordered from you
because of your reputation of always providing excellent and dependable customer service.
Therefore, we would like you to look into the matter and replace the two modems immediately.
Should we fail to receive the replacement by tomorrow, we shall be prepared to receive a full
refund for the two modems.
Thank you for your attention in this matter and please contact me at 2345-2345 should you
need any further information.
I look forward to receiving the replacement soon.
Yours faithfully
..
Office Manager
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Duration of loan
Risks involved
Question eight
Mr Ahmed and Mrs Singh are sole traders owning shops of equal size in the same street.
(a) Explain why Mr Ahmed may have to pay a larger insurance premium for fire insurance
than Mrs Singh. [3 marks]
The intensity of the risk
The sum insured
(b) Explain two business risks, apart from fire, against which both Mr Ahmed and Mrs Singh
should insure. [4marks]
Burglary
Accidents
(c) Explain why they cannot insure their shops against the risk of bad management.
[4marks]
The extent of loss from such a risk cant easily be calculated
(d) Name one insurance principle and explain how it might apply to a fire insurance policy.
[4marks]
Utmost goodfaith (uberrimae fidei )
This Principle requires that the insured person to disclose all important facts about the
insured property to the insurance company even if the company does not specifically
ask questions about them. e.g. if the house to be insured is of wood, this fact must be
disclosed to the insurer.
This principle continues thorough the term. If for example a person with a life policy or
personal accident policy takes up a dangerous sport or occupation, he must inform the
insurers. This would be the case if he gave up an office job to work in the mines.
Insurable Interest:
The insured must be so situated in regard to the property insured that he would suffer
loss or benefit from its existence or destruction. I.e. a person can only effect an
insurance policy he possesses the interest in the subject matter. A person cannot gain
from occurrence of the event. It follows also that if ones property is insured with two
companies, the two will contribute to the loss for the exact value of the house and no
more.
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Subrogation:
This is a common law right of a person to stand in the legal position of the other and
avail himself with of the rights and remidie4s of the insured. In this case after an insured
has been indemnified, the rights in the residual sums or remains raised from the salvage
from the loss, pass on to the insurer.
The doctrine of proximate cause:
It states that there must be a fairly close connection between the cause of a loss and the
actual loss. In other words, the loss must be dominantly and effectively resulting from a
risk for which the insurance policy was taken against. If for example people set your
house on fire during a riot, the cause of your house being destroyed is rioting not fire. If,
on the other hand, sparks from the fire place set things on fire and the house is
subsequently burnt down, the proximate cause of your losing the house is fire.
Indemnity:
The principle states that no one can get compensation exceeding the actual monetary
loss caused by the event insured against. The object is to place the insured in the same
position as he was in before the event occurred. e.g. if a second hand car was stolen,
the compensation will be the assessed on its present day worth or value not its original
cost.
END
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