WAEC Commerce 2013 Theory — Question 7

Model answer

(a) Tramp vessels do not have a fixed schedule while ocean liners do have a fixed schedule. Tramp vessels do not have an itinerary port of calls while ocean liners do. (b) A factor takes possession of goods while broker does not take possession of goods. The factor takes commission while the broker collects brokerage. (c) A commissioned agent does not guarantee the principal of bad debts on the part of the buyer while a del-credere agent does. A del-credere agent receives additional commission known as del-credere, a commissioned agent does not. (d) A consular invoice shows the certification for shipment of goods while a proforma invoice does not. A proforma invoice shows details of goods the buyer intends and their prices while a consular invoice does not. (e) Insurance is taken against indemnifiable events such as accidents, while assurance is taken against non-indemnifiable events such as life. Assurance is an endowment policy taking for life assurance, insurance is a compensating policy.