The question was attempted by a few candidates, some of the few candidates who attempted the question missed out the comparison conjunction such as while, but, where as. Hence they listed the facts without comparing them. The answers expected were for example.
(a) Trade Discount and Cash Discount: Trade discount is the reduction in price of goods given to a customer so as to encourage him to continue to buy more from the seller, while cash discount is reduction in price given to the buyer to encourage him to pay promptly.
(b) Indemnity and Compensation: Indemnity is an arrangement where the insured is restored to his former position just before the risk insured against occurred, While compensation means paying money to the insured on estimates because indemnity is not possible. A typical example is life policy where life cannot be restored.
(c) Credit Sales and Hire Purchase: A credit sale is an arrangement where goods are sold to a consumer with a promise to pay at a later date. The ownership passes to the buyer immediately while Hire purchase is a sale agreement where the buyer pays a deposit and then agrees to pay the balance on instalment basis. The ownership remains with the seller until the last instalment is paid.
