NTA UGC NET/JRF Exam, Dec. 2020/June 2021 (Commerce) Shift-II

• FDI in Indian manufacturing has Largely been market seeking. Market seeking- FDI Means to identify and exploit new markets for the firm's finished products. And secure market share and sales growth in target foreign market.
• India has become one of the most attractive destinations for investment in the manufacturing sector due to it's large market size as per latest report of Appliances and consumer electronics (ACE) market in India is expected to grow to US $ 21.18 billion by 2025 and other Robust demand like in Defence manufacturing etc.

Occasional sale of a commodity at a lower price abroad in order to unload an unforeseen and temporary surplus of the commodity without reducing domestic price is called. Sporadic dumping.

• Sporadic dumping is the practice of occasional dumping. It means that the when company produce in excess and is not able to sell in domestic market, it export the same at a lower price to liquidate excess inventory.
  For Example:-
  Asian farmers dumped small chickens into the sea.

● WTO (World Trade Organisation) was established in 1995. It is the global international organisation dealing with the rules of trade between nations.
● WTO has over 160 members and over 20 countries seeking to join the WTO. China- 11 December 2001.
Russia- 22 August 2022.
Taiwan- 1 January 2002.
Iran- It has an observer status at the world trade organisation since 2005.

USMCA has recently been negotiated to replace NAFTA with effect from july 2020.
● United States- Mexico Canada Agreement (USMCA) entered into force on Jyly 1, 2020.
● It is a free trade agreement between Canada, Mexico, and the United States.
● It is replaced the North American free Trade Agreement (NAFTA) implemented in 1994.

Amalgamation adjustment account is used for recording Statutory Reserve in the books of the transferee company.
• Amalgamation Adjustment Account is created when there is an amalgamation of companies under purchased method.
• This account is used when there is not other adjustment account available and used for recording the transaction for legal compliance during amalgamation.
• Journal Entry
Amalgamation Adjustment Reserve A/C Dr to Statutory Reserve.

the accounting standard AS3 (Revised) has become mandatory w.e.f. accounting periods beginning from 01-04-2001 for the commercial, industrial and business reporting enterprises whose turnover for the accounting period exceeds ₹50 Crores.
• Cash flow statement are to be prepared by all companies but act also specifics a certain category of companies which are exempted such companies are one person company (OPC). Small company & Dormat company.
• It is mandatory for the Enterprises whose equity or debt securities are listed wheather in India or outside India.
• mandatory for Enterprises which are in the process of listing their equity or debt securities as evidenced by the boards of directors’ resolution in this regard.
• Banks including co-operative banks.
• Financial institutions.
• Enterprises carrying on insurance business.
• AU Commercial, industrial and business reporting enterprises having borrowings, including public deposits, in excess of ₹10 crores.
• Holding and subsidiary enterprises of any one of the above at any time during the accounting period.

A method of inflation accounting is as a result of recommendation of Sandilands committee.
• Inflation accounting uses two primary methods i.e. current purchasing power (CPP) and current cost accounting (CCA).
• Current cost Accounting (CCA) method values assets at their fair market value (FMV) rather than at historical cost, the price paid when the fixed asset was purchased.
Note : Sandilands committee chaired by Sir Francis Sandilands, set up in 1975 by the UK government to consider the most appropriate way to account for the effects of inflation in the published accounts of companies.

The cross elasticity of demand between the complementary products is Negative.
• As the price for one item increases, an item closely associated with that item and necessary for its consumption decreases because the demand for the main goods has also dropped.
• For Example if the price of coffee increases, the quantity demanded for coffee stir sticks drops to purchase fewer sticks.