Class 9 Commercial Studies — Chapter 3: Profit and Non-Profit Organisations Chapter-wise Questions Answers and MCQs

 Class 9 Commercial Studies —

Chapter 3: Profit and Non-Profit Organisations

Chapter-wise Questions Answers and MCQs

Chapter 3: Profit and Non-Profit Organisations

Exam-Oriented MCQs

Multiple Choice Questions

1. The primary objective of a profit-seeking organisation is:
   

            (A) Social service

            (B) Education

            (C) Earning profit

            (D) Charity 

            Answer: (C) Earning profit

2.               Profit-seeking organisations are basically:

(A) Religious organisations

(B) Business organisations

(C) Charitable organisations

(D) Clubs 

Answer: (B) Business organisations

3.               Which of the following is a profit-seeking organisation?

(A) Temple

(B) Hospital run for charity

(C) Grocery shop

(D) Red Cross 

Answer: (C) Grocery shop

4.               Non-profit organisations are established to:

(A) Earn maximum profit

(B) Serve society

(C) Increase production

(D) Reduce taxes 

Answer: (B) Serve society

5.               Which of the following is a charitable organisation?

(A) Tata Trust

(B) Sugar Mill

(C) Truck Company

(D) Automobile Workshop 

Answer: (A) Tata Trust

6.               IITs and IIMs are examples of:

(A) Religious organisations

(B) Educational organisations

(C) Political organisations

(D) Clubs 

Answer: (B) Educational organisations

7.               Gurudwara Prabandhak Committee is a:

(A) Political organisation

(B) Religious organisation

(C) Educational organisation

(D) Municipal organisation 

Answer: (B) Religious organisation

8.               Public hospitals are examples of:

(A) Public health organisations

(B) Political organisations

(C) Clubs

(D) Profit organisations

 Answer: (A) Public health organisations

9.               New Delhi Municipal Corporation is a:

(A) Religious organisation

(B) Municipal organisation

(C) Political organisation

(D) Trust 

Answer: (B) Municipal organisation

10.           BJP is an example of:

(A) Political organisation

(B) Charitable organisation

(C) Educational organisation

(D) Municipal organisation

 Answer: (A) Political organisation

11.           Hind Mazdoor Sabha (HMS) is a:

(A) Trust

(B) Political party

(C) Mutual benefit organisation

(D) Religious organisation 

Answer: (C) Mutual benefit organisation

12.           Army, police and fire services are examples of:

(A) Common Weal Organisations

(B) Trusts

(C) Clubs

(D) Industries 

Answer: (A) Common Weal Organisations

13.           The net result of operations in a non-profit organisation is:

(A) Profit

(B) Loss

(C) Surplus or Deficit

(D) Income

 Answer: (C) Surplus or Deficit

14.           Government grants are generally available to:

(A) Profit organisations

(B) Non-profit organisations

(C) Private companies

(D) Factories 

Answer: (B) Non-profit organisations

15.           Which organisation is exempted from income tax?

(A) Factory

(B) Trust

(C) Shop

(D) Industry 

Answer: (B) Trust

16.           A trust is registered under:

(A) Companies Act

(B) Indian Trusts Act

(C) Factories Act

(D) Banking Regulation Act 

Answer: (B) Indian Trusts Act

17.           A non-profit company is registered under:

(A) Companies Act, 2013

(B) Indian Trusts Act

(C) Cooperative Societies Act

(D) Income Tax Act 

Answer: (A) Companies Act, 2013

18.           The main problem faced by profit-seeking organisations is:

(A) Welfare activities

(B) Maximising operating efficiency

(C) Charity

(D) Education 

Answer: (B) Maximising operating efficiency

19.           Surplus generated by non-profit organisations is:

(A) Distributed among members

(B) Not distributed

(C) Given as bonus

(D) Shared as dividend 

Answer: (B) Not distributed 

20.           Red Cross and CRY are examples of:

(A) Community serving organisations

(B) Factories

(C) Political organisations

(D) Municipal organisations 

Answer: (A) Community serving organisations

 21. Profit-seeking organisations are established primarily to earn ______.

(A) Donations

(B) Profits

(C) Grants

(D) Taxes

 Answer: (B)

 22. Non-profit organisations are established to ______ society.

 

(A) Control

(B) Serve

(C) Tax

(D) Govern 

Answer: (B)

 23. The owners of profit-seeking organisations focus on reducing ______.

(A) Sales

(B) Production

(C) Costs

(D) Labour 

Answer: (C)

 24. The net result of a non-profit organisation may be a surplus or a ______.

 

(A) Dividend

(B) Deficit

(C) Grant

(D) Bonus

 Answer: (B)

 25. Government grants are generally available to ______ organisations.

(A) Non-profit

(B) Profit

(C) Private

(D) Industrial 

Answer: (A)

 26. Which of the following is NOT a profit-seeking organisation?

(A) Sugar Mill

(B) Grocery Shop

(C) Truck Company

(D) Red Cross

 Answer: (D)

 27. Which of the following is an educational organisation?

(A) IIT

(B) BJP

(C) Temple

(D) Police 

Answer: (A)

 28. Which organisation provides scholarships to students?

 

(A) Educational Trust

(B) Factory

(C) Automobile Workshop

(D) Truck Company 

Answer: (A)

 29. Which organisation works for public health?

 

(A) Sulabh International

(B) Tata Steel

(C) BJP

(D) AMUL 

Answer: (A)

 30. Which is a religious organisation?

 

(A) Gurudwara Prabandhak Committee

(B) CRY

(C) HMS

(D) NDMC

 Answer: (A)

 31. Non-profit organisations distribute surplus among members.

 

(A) True

(B) False 

Answer: (B)

 32. Profit organisations face high risk.

(A) True

(B) False 

Answer: (A)

 33. Public hospitals are established to earn profits.

 

(A) True

(B) False 

Answer: (B)

 34. Trusts are exempt from income tax.

 

(A) True

(B) False 

Answer: (A)

 35. Cooperative societies are non-profit organisations.

 

(A) True

(B) False 

Answer: (A)

 36. Ratan Tata Trust is a:

 

(A) Trust

(B) Club

(C) Political Party

(D) Municipal Body 

Answer: (A)

 37. AMUL is an example of:

 

(A) Cooperative Society

(B) Political Organisation

(C) Religious Organisation

(D) Trust 

Answer: (A)

 38. Lions Club is a:

 

(A) Club

(B) Industry

(C) Political Party

(D) Trust 

Answer: (A)

 39. CRY stands for a community-serving:

 

(A) Organisation

(B) Factory

(C) Industry

(D) Business 

Answer: (A)

 40. Army belongs to:

 

(A) Common Weal Organisation

(B) Religious Organisation

(C) Trust

(D) Club 

Answer: (A)

 41. Which organisation primarily undertakes production and distribution?

 

(A) Profit Organisation

(B) Religious Organisation

(C) Municipal Organisation

(D) Trust 

Answer: (A)

 42. Which organisation mainly helps people rather than producing goods?

 

(A) Non-profit Organisation

(B) Factory

(C) Industry

(D) Shop 

Answer: (A)

 43. The main source of motivation for starting a business is:

 

(A) Profit

(B) Charity

(C) Religion

(D) Politics 

Answer: (A)

 44. Which of the following is not a type of non-profit organisation?

 

(A) Political Organisation

(B) Municipal Organisation

(C) Grocery Shop

(D) Public Health Organisation Answer: (C)

 45. Which organisation provides water supply and sanitation services?

 

(A) Municipal Organisation

(B) Club

(C) Trust

(D) Industry 

Answer: (A)

 46. The excess of income over   expenditure in a non-profit organisation is called:

(A) Profit

(B) Surplus

(C) Dividend

(D) Interest

Answer: (B)

47. A deficiency of income over expenditure is called:

 

(A) Profit

(B) Dividend

(C) Deficit

(D) Bonus

 Answer: (C)

 48. A group of ten or more persons may form a:

 

(A) Society

(B) Industry

(C) Factory

(D) Company 

Answer: (A)

 49. Trustees manage:

 

(A) Trusts

(B) Factories

(C) Political Parties

(D) Clubs 

Answer: (A)

 50. Directors manage:

           (A) Non-profit Companies

(B) Temples

(C) Hospitals

(D) Municipal Bodies

Answer: (A)

Very Short Answer Questions (1 Mark)

Q1. What is a profit-seeking organisation?

Answer: An organisation established primarily to earn profits.

Q2. What is a non-profit organisation?

Answer: An organisation established to serve society and not to earn profits.

Q3. Give one example of a profit organisation.

Answer: Grocery shop.

Q4. Give one example of a charitable organisation.

Answer: Tata Trust.

Q5. What is the main motive of non-profit organisations?

Answer: To render services to society.

Q6. What is the net result in a non-profit organisation called?

Answer: Surplus or deficit.

Q7. Name one political organisation.

Answer: BJP.

Q8. Name one public health organisation.

Answer: Sulabh International.

Q9. Under which Act are trusts registered?

Answer: Indian Trusts Act.

Q10. Under which Act are cooperative societies registered?

Answer: Cooperative Societies Act, 1912.

Short Answer Questions (2–3 Marks)

Q1. State any two features of profit-seeking organisations.

Answer:

1. Their primary objective is earning profit.
2. They undertake production and sale of goods and services.

Q2. State any two features of non-profit organisations.

Answer:

1. They are established to serve society.
2. Surplus earned is not distributed among members.

Q3. What are charitable organisations?

Answer: Charitable organisations provide financial assistance and welfare services to poor and needy people. They work for social causes.

Q4. Mention any four types of non-profit organisations.

Answer:

1. Charitable organisations
2. Educational organisations
3. Religious organisations
4. Political organisations

Q5. What are educational organisations?

Answer: Educational organisations provide education to the public at nominal cost and help in human resource development.

Q6. What are religious organisations?

Answer: Religious organisations provide facilities for religious activities and worship.

Q7. What are municipal organisations?

Answer: Municipal organisations provide civic services such as water supply, sanitation, electricity and sewage disposal.

Q8. What are mutual benefit organisations?

Answer: They are voluntary associations established for the benefit of their members and the public.

Q9. What are common weal organisations?

Answer: These organisations work for the welfare and protection of the public at large, such as army and police.

Q10. What is a trust?

Answer: A trust is formed when a person transfers property or money for social welfare purposes and appoints trustees to manage it.

Important Long Short Questions (4–5 Marks)

Q1. Distinguish between Profit and Non-Profit Organisations.

Basis	Profit Organisation	Non-Profit Organisation
Motive	Earn profit	Render services
Function	Production and distribution	Helping people
Risk	High	Low
Result	Profit or Loss	Surplus or Deficit
Tax	Payable	Generally exempt
Grants	Not available	Available

Q2. Explain any five types of non-profit organisations.

Answer:

1. Charitable Organisations
2. Educational Organisations
3. Religious Organisations
4. Public Health Organisations
5. Municipal Organisations

Q3. Explain the organisation of non-profit organisations.

Answer: Non-profit organisations are generally organised as:

1. Societies
2. Trusts
3. Non-profit Companies

Q4. What are the functions of charitable organisations?

Answer:

1. Providing financial assistance.
2. Offering scholarships.
3. Helping poor and needy people.
4. Conducting relief work during disasters.
5. Promoting education and health.

 

Chapter 3: Profit and Non-Profit Organisations

1. Define a Profit-Seeking Organisation.

Answer: A profit-seeking organisation is an organisation established and operated primarily with the objective of earning profits through the production, purchase, and sale of goods and services.

2. Define a Non-Profit Organisation.

Answer: A non-profit organisation is an organisation established not to earn profits but to serve society and promote social welfare. Any surplus earned is used for its objectives and is not distributed among members.

3. State Any Four Differences Between Profit and Non-Profit Organisations.

 

Basis               Profit Organisations               Non-Profit Organisations

Objective         To earn profits                         To render services

Risk                             High                             Low

Result              Profit or Loss                           Surplus or Deficit

Functio    Production and distribution of goods and services  Helping people and serving society

4. Explain Charitable Organisations.

Answer: Charitable organisations are established to provide financial assistance and welfare services to poor, needy, and underprivileged people. They help society through donations, scholarships, relief work, medical aid, and educational support.

Examples:

Ratan Tata Trust

Educational Trusts

Lions Club

Rotary Club

5. Name and Explain the Types of Non-Profit Organisations.

Answer:

i. Charitable Organisations

 Provide financial assistance and support for social causes. 

ii. Educational Organisations

 Run schools, colleges, libraries, and educational institutions.

 iii. Religious Organisations

 Provide facilities for religious activities and worship.

 iv. Public Health Organisations

 Provide healthcare and medical facilities to the public.

 v. Municipal Organisations

 Provide civic amenities such as water supply, sanitation, and electricity.

 vi. Political Organisations

 Promote and protect the political interests of members.

 vii. Mutual Benefit Organisations

 Work for the benefit of members and society.

 viii. Common Weal Organisations

 Work for the welfare and protection of the public at large.

 

6. What is a Trust?

 Answer: A trust is a legal arrangement in which a person transfers money or property to trustees for social welfare purposes. The trustees manage the trust and use its resources for the benefit of beneficiaries.

 Examples:

Sir Dorabji Tata Trust

Educational Trusts

 

7. What is a Non-Profit Company?

 Answer: A non-profit company is a company registered under the Companies Act, 2013 for purposes other than earning profits. Any income earned is used to achieve the organisation's objectives and is not distributed among members. It is managed by a Board of Directors.

 Example: Sulabh International.

 

8. Explain Mutual Benefit Organisations.

 Answer: Mutual benefit organisations are voluntary associations established for the welfare and benefit of their members as well as the public. They promote common interests and provide support to members. 

Examples:

Clubs

Trade Unions

Hind Mazdoor Sabha (HMS)

 

9. Explain Common Weal Organisations.

 Answer: Common weal organisations are established for the welfare, protection, and benefit of society as a whole. They provide essential public services and ensure public safety.

Examples:

Army

Police

Fire Services

 

10. Write a Note on Educational Organisations.

Answer: Educational organisations are non-profit organisations established to provide education and promote human resource development. They run schools, colleges, universities, libraries, and other educational institutions. Many of them offer education at nominal cost and provide scholarships to deserving students.

 Examples:

IITs

IIMs

Government Schools and Colleges

Educational Trusts

 

Explain the Organisation of Non-Profit Organisations.

 Answer: Non-profit organisations are generally organised in the following forms:

 1. Societies

 A society is formed by ten or more persons who voluntarily join together to promote common interests. It is managed by an elected executive committee.

 2. Trusts

 A trust is formed when a person transfers property or money to trustees for social welfare purposes. Trusts are registered under the Indian Trusts Act.

 3. Non-Profit Companies

 These companies are registered under the Companies Act, 2013. They are managed by a Board of Directors and work for social welfare rather than profit-making.

 

Definitions to Memorise for Exams

 Profit-Seeking Organisation: Organisation established to earn profits.

 Non-Profit Organisation: Organisation established to serve society.

 Charitable Organisation: Organisation providing assistance to needy people.

 Trust: Property or money managed by trustees for social welfare.

 Society: Voluntary association formed by ten or more persons.

 Surplus: Excess of income over expenditure.

 Deficit: Excess of expenditure over income.