Question 1
(1) (a) (i) Define the term contract as used in plumbing.
(ii) List two types of engineering contract.
(b) (i) Define business organisation.
(ii) Explain two types of business organisation.
(c) Explain each of the following:
(i) profit and loss account;
(ii) trial balance.
Observation
Most of the candidates could not provide correct responses to these questions. The required responses are given below.
1(a) (i) Contract is an agreement having a lawful object, entered into voluntarily
by two or more parties, each of whom intends to create one or more legal obligation.
(ii) Engineering Contract
- Unit-price contract
- Lumpsum contract
- Cost plus contract
- Incentive contract
- Percentage of construction fee contract
- Building operate and transfer (BOT) contract
- Concessioning contract
- Turn-key contract
(b) (i) Business organisation is an individual or group of people that collaborate
to achieve certain commercial goals (profit)
(ii) - Sole proprietorship – one man business. The risk and profit is for
one man.
- Partnership: Two or more in agreement for the purpose of making profit. the risk and profit are shared by the partners
- Limited Liability Company
- Private and Public Limited Liability Company.
(c) Profit and Loss account: is a book where records of revenue and expenses of an
organisation are kept.