Which of the following statements are true and which are false?
(i) In auction sale, goods are always sold to the highest bidder even when
there is a reserve price.
(ii) Sale on hire-purchase permits the buyer to return the goods at any stage.
(iii) Goods delivered to the buyer ‘on approval’ basis are always paid for in
advance.
(iv) Earnest money payable by tenderers ensures their seriousness about
the tender.
(v) Wash sales refer to sale of goods at a discount just after rainy reason.
Answers
Answer:
(i) In auction sale, goods are always sold to the highest bidder even when
there is a reserve price. TRUE
The statement is true because it allows the highest bidder to buy the product.
(ii) Sale on hire-purchase permits the buyer to return the goods at any stage. FALSE
Sale on hire-purchase restricts the buyer to return the goods at any stage and the ownership always remains to the seller.
iii) Goods delivered to the buyer ‘on approval’ basis are always paid for in
advance. FALSE
Goods delivered to the buyer ‘on approval’ basis are not paid for in
advance because in this type of dealings the buyer understands and sends it on approval on a belief that it would be returned in a remit.
(iv) Earnest money payable by tenderers ensures their seriousness about
the tender. TRUE
The statement is true because it involves huge quantity of supplies.
(v) Wash sales refer to sale of goods at a discount just after rainy reason.FALSE
The statement is wrong because wash sales means to clear up some old stocks of the product.