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MARKET
Preview
- Careers in the capital market
- Buying and selling : meaning, cash or credit
- Transaction: Costs of Sale, Markup, turnover, profit and loss
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4. Careers in the Capital Market
Careers are available in the capital market for those who study Accountancy, Economics, Finance and Business administration. Such people can work in:
- Stock broking firms as stockbrokers
- Pensions funds administration
- Stock Exchange
- Issuing House
- Insurance Companies, etc.
They can also be employed as
- jobbers
- bankers
- stock brokers
- insurance agents
- financial advisers
- Bull
- Bear
- Stag etc.
5. Buying and Selling
Buying is the ability to obtain or purchase goods and services by paying cash or on credit. Selling is the offering of goods and services for sale in exchange for cash or credit. Therefore buying and selling can be defined as the transfer of ownership of goods in exchange for money.
Buying and selling can be done through various methods which are:
Methods of Buying and Selling
- By Sampling: in this case, the buyer is shown a part or an exact copy of the goods he wishes to buy. The buyer can be allowed to taste, test, see and feel the quality of the good before making any payment.
- By Inspection: here, the buyer sees the actual goods he wishes to buy and may even test it. The buyer’s impression about the tested goods determines if he will buy the goods or not.
- By Description or Grade: Here also, the buyer relies on the description of the goods made by seller. He may choose to buy if he agrees with the stipulated made by the seller on the goods. For example: eggs are classified and sold based on their sizes , coffee , soft drinks, ice cream, cocoa drinks .
- By Auction: Auctions are public sales in which goods are sold to the buyer who offers the highest price (highest bidder).
6. CASH AND CREDIT SALES
A cash sales is one in which the buyers pay for the goods in cash. It occurs when goods are paid for on the spot and the buyer receives a receipt as an evidence of payment. While Credit sales occur when payment is to be made for sales later than the time the goods was bought. it is a means by which goods and services are transferred to the buyer from the seller without any spot payment.
7. Cost of Sales
The cost of sales means the price paid for the product plus any additional expenses incurred in order to put the goods into stock and ready to sell. Such other expenses could be transportation and delivery cost, packaging cost, handling costs etc.
The formula for calculating the costs of sales is =
Opening stock + purchases – closing stock
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