Exam (elaborations) BBA COMMERCE (COM101) Business Mathematics (For B.Com, BBA, BBM and BMS), ISBN: 9789325983229
COMMISSION, BROKERAGE, DISCOUNT AND PARTNERSHIP OBJECTIVES Money plays an important role in any transaction. We are going to study some Technical terms involved in business transactions. 1.1 COMMISSION A producer or manufacturer of goods generally does not sell his goods directly to the ultimate consumer. There are agents who purchase the goods from the manufacturer and sell them to the consumer. In a sense, such agents bring the manufacturers and the consumers together for transaction. The remuneration which an agent gets for his services in the transaction is called commission. Most of the business transactions are made through intermediate persons. 1.2 RATE OF COMMISSION The amount of commission that an agent gets in the transaction depends on the volume of work done or the services rendered by him. His commission is based on the value of the goods bought or sold and is generally fixed on a percentage basis. In some cases, he is paid a commission on the total sales brought by the agent or on different slabs. For example, it may be 5% on the first Rs. 10,000/-, 6% on the next Rs. 5,000/- and so on. 1.3 TYPES OF COMMISSION AGENTS On account of the different fields of specialization in business activities agents can be differentiated as such as commission agents, brokers, del credere agents, factors, insurance agents, export agents, auctioneers, etc. Agents particularly salesmen are also paid regular salary in addition to commission they earn. Commission Agent: A commission agent is that middle-man who buys or sells goods on behalf of some other person called as principal. He is usually employed by his principal and gets commission as some percentage of the sale value. Broker : A broker is that middle-man who brings together a prospective seller and a prospective buyer and negotiates the sale between them. The
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- Prairie View A&M State University
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- BBA COMMERCE (COM101)
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- 20 december 2021
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commission
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discount and partnership objectives money plays an important role in any transaction we are going to study some technical terms involved in business transactions 11 commiss