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NCERT Solutions
Enterprise Planning
CBSE · Class 12 · Entrepreneurship
NCERT Solutions for Enterprise Planning — CBSE Class 12 Entrepreneurship.
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Across-1A business unit whose ownership and management are vested in one person.Show solution
Answer: SOLE PROPRIETORSHIP
A sole proprietorship is a form of business organisation where a single individual owns, manages, and controls the entire business. All profits belong to the owner and he/she bears unlimited liability.
A sole proprietorship is a form of business organisation where a single individual owns, manages, and controls the entire business. All profits belong to the owner and he/she bears unlimited liability.
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Across-3AMUL comes under this form of business.Show solution
Answer: COOPERATIVE
AMUL (Anand Milk Union Limited) is one of the most famous examples of a cooperative society in India. It is owned and managed by its members (dairy farmers) for their mutual benefit.
AMUL (Anand Milk Union Limited) is one of the most famous examples of a cooperative society in India. It is owned and managed by its members (dairy farmers) for their mutual benefit.
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Across-4A financial statement that summarizes a company's assets, liabilities and shareholders' equity at a specific point in time.Show solution
Answer: BALANCE SHEET
A Balance Sheet is a financial statement that presents a snapshot of a company's financial position at a specific date. It shows:
- Assets (what the company owns)
- Liabilities (what the company owes)
- Shareholders' Equity (owners' stake)
A Balance Sheet is a financial statement that presents a snapshot of a company's financial position at a specific date. It shows:
- Assets (what the company owns)
- Liabilities (what the company owes)
- Shareholders' Equity (owners' stake)
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Across-5Tax on the sale, or production for sale, of specific goods.Show solution
Answer: EXCISE (Duty)
Excise duty is an indirect tax levied by the government on the manufacture or production of specific goods within the country. It is paid by the manufacturer and is usually passed on to the consumer.
Excise duty is an indirect tax levied by the government on the manufacture or production of specific goods within the country. It is paid by the manufacturer and is usually passed on to the consumer.
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Across-6A comprehensively written document prepared by the entrepreneur.Show solution
Answer: BUSINESS PLAN
A business plan is a comprehensive, formally written document prepared by an entrepreneur that describes the business, its objectives, strategies, market, and financial forecasts. It serves as a roadmap for the enterprise.
A business plan is a comprehensive, formally written document prepared by an entrepreneur that describes the business, its objectives, strategies, market, and financial forecasts. It serves as a roadmap for the enterprise.
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Across-8Type of liability that does not exceed the amount invested.Show solution
Answer: LIMITED (Liability)
Limited liability means that the personal assets of the owners/shareholders are protected. Their liability is restricted only to the amount they have invested or agreed to contribute in the business.
Limited liability means that the personal assets of the owners/shareholders are protected. Their liability is restricted only to the amount they have invested or agreed to contribute in the business.
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Across-11Total supply of personnel available.Show solution
Answer: MANPOWER
Manpower refers to the total supply of persons available and fitted for service or work in a business organisation. Manpower planning ensures the right number of people with the right skills are available at the right time.
Manpower refers to the total supply of persons available and fitted for service or work in a business organisation. Manpower planning ensures the right number of people with the right skills are available at the right time.
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Across-13A tax levied on imports by the customs authorities of a country.Show solution
Answer: CUSTOMS (Duty) / TARIFF
Customs duty (tariff) is a tax imposed by the government on goods imported into the country. It is collected by the customs authorities at the port of entry and is used to regulate trade and protect domestic industries.
Customs duty (tariff) is a tax imposed by the government on goods imported into the country. It is collected by the customs authorities at the port of entry and is used to regulate trade and protect domestic industries.
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Across-14The process of transporting an item, usually through by mail.Show solution
Answer: SHIPPING
Shipping refers to the process of transporting goods or items from one location to another, typically through postal or courier services. In an operational plan, shipping is a key component of the distribution process.
Shipping refers to the process of transporting goods or items from one location to another, typically through postal or courier services. In an operational plan, shipping is a key component of the distribution process.
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Down-2An association of two or more people.Show solution
Answer: PARTNERSHIP
A partnership is a form of business organisation where two or more persons come together, agree to share capital, manage the business jointly, and share the profits and losses in an agreed ratio. It is governed by the Indian Partnership Act, 1932.
A partnership is a form of business organisation where two or more persons come together, agree to share capital, manage the business jointly, and share the profits and losses in an agreed ratio. It is governed by the Indian Partnership Act, 1932.
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Down-4A point in a business venture when the profits are equal to the costs.Show solution
Answer: BREAK-EVEN (Point)
The break-even point is the level of sales/production at which total revenue equals total costs (fixed + variable), resulting in neither profit nor loss. It is calculated as:
The break-even point is the level of sales/production at which total revenue equals total costs (fixed + variable), resulting in neither profit nor loss. It is calculated as:
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Down-7The total amount of money being transferred into and out of a business.Show solution
Answer: CASH FLOW
Cash flow refers to the total amount of money moving into (inflows) and out of (outflows) a business over a specific period. A positive cash flow indicates the business has more money coming in than going out, which is essential for smooth operations.
Cash flow refers to the total amount of money moving into (inflows) and out of (outflows) a business over a specific period. A positive cash flow indicates the business has more money coming in than going out, which is essential for smooth operations.
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Down-9Something pledged as security for repayment of a loan.Show solution
Answer: COLLATERAL
Collateral is an asset or property that a borrower pledges to a lender as security for a loan. If the borrower fails to repay the loan, the lender has the right to seize the collateral to recover the outstanding amount.
Collateral is an asset or property that a borrower pledges to a lender as security for a loan. If the borrower fails to repay the loan, the lender has the right to seize the collateral to recover the outstanding amount.
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Down-10Synonym of 'useful'.Show solution
Answer: VIABLE
Viable means capable of working successfully or being useful. In the context of business, a viable business plan or idea is one that is practical, feasible, and capable of generating profit.
Viable means capable of working successfully or being useful. In the context of business, a viable business plan or idea is one that is practical, feasible, and capable of generating profit.
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Down-12Process concerned with determining the exact route or path of a product.Show solution
Answer: ROUTING
Routing is the process of determining the exact path or sequence of operations through which a product must pass during the production process. It specifies the machines, equipment, and workstations to be used.
Routing is the process of determining the exact path or sequence of operations through which a product must pass during the production process. It specifies the machines, equipment, and workstations to be used.
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Let's Revise — A. Very Short Type Questions (10 words)
1Give any two contents of a business plan.Show solution
Given: Question about contents of a business plan.
Answer: Two contents of a business plan are:
1. Executive Summary – A brief overview of the entire business plan.
2. Financial Plan – Details of funding requirements, projected income, and cash flow statements.
Answer: Two contents of a business plan are:
1. Executive Summary – A brief overview of the entire business plan.
2. Financial Plan – Details of funding requirements, projected income, and cash flow statements.
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2Who can write the business plan?Show solution
Answer: A business plan can be written by the entrepreneur himself/herself, or it can be prepared with the help of professional consultants, accountants, or business advisors. Ultimately, the entrepreneur is responsible for its content.
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3How many formats are available to design a successful business plan?Show solution
Answer: There is no single fixed format for a business plan. However, broadly three formats are commonly recognised:
1. The Mini Plan
2. The Working Plan
3. The Presentation Plan (What-if Plan)
The format chosen depends on the purpose and audience of the plan.
1. The Mini Plan
2. The Working Plan
3. The Presentation Plan (What-if Plan)
The format chosen depends on the purpose and audience of the plan.
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4What is the meaning of shipping in the process of operational plan?Show solution
Answer: In the context of an operational plan, shipping refers to the process of transporting or dispatching the finished goods from the place of production to the customer or distribution point, usually through postal, courier, or freight services.
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5What is a proforma income statement?Show solution
Answer: A proforma income statement (also called a projected income statement) is a financial forecast that estimates a company's future revenues, expenses, and net profit/loss over a specific period. It is prepared on the basis of assumptions and helps in financial planning.
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6What is break-even analysis?Show solution
Answer: Break-even analysis is a financial tool used to determine the point at which total revenue equals total costs, resulting in neither profit nor loss. It helps the entrepreneur understand the minimum level of sales needed to cover all costs.
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7What is meant by a target market?Show solution
Answer: A target market refers to a specific group of consumers or customers that a business aims to reach with its products or services. It is identified on the basis of factors such as age, income, geography, interests, and buying behaviour.
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8What is TAN?Show solution
Answer: TAN stands for Tax Deduction and Collection Account Number. It is a 10-digit alphanumeric number issued by the Income Tax Department of India to persons who are required to deduct or collect tax at source (TDS/TCS). It is mandatory to quote TAN in all TDS/TCS returns and challans.
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Let's Revise — B. Short Type Questions (50 words)
1What is a business plan?Show solution
Given: Question on definition of a business plan.
Concept: A business plan is a formal written document.
Answer:
A business plan is a comprehensively written document prepared by an entrepreneur that describes the nature of the business, its goals and objectives, strategies to achieve them, the target market, financial projections, and the resources required. It serves as a roadmap for starting and running the business successfully. It is also used to attract investors and secure loans from financial institutions.
Concept: A business plan is a formal written document.
Answer:
A business plan is a comprehensively written document prepared by an entrepreneur that describes the nature of the business, its goals and objectives, strategies to achieve them, the target market, financial projections, and the resources required. It serves as a roadmap for starting and running the business successfully. It is also used to attract investors and secure loans from financial institutions.
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2What is elevator pitch?Show solution
Answer:
An elevator pitch is a brief, persuasive speech or presentation that an entrepreneur uses to spark interest in his/her business idea. It is called an 'elevator pitch' because it should be short enough to be delivered during a brief elevator ride (approximately 30–60 seconds). It summarises:
- What the business does
- Who the target customers are
- What makes it unique
It is used to quickly communicate the value of a business to potential investors or partners.
An elevator pitch is a brief, persuasive speech or presentation that an entrepreneur uses to spark interest in his/her business idea. It is called an 'elevator pitch' because it should be short enough to be delivered during a brief elevator ride (approximately 30–60 seconds). It summarises:
- What the business does
- Who the target customers are
- What makes it unique
It is used to quickly communicate the value of a business to potential investors or partners.
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3What is a production plan?Show solution
Answer:
A production plan is a component of the operational plan that outlines how the goods or services will be produced. It includes details about:
- The production process and methods
- Machinery and equipment required
- Raw materials needed
- Quality control measures
- Production capacity and schedule
It ensures that production is carried out efficiently, on time, and within budget to meet customer demand.
A production plan is a component of the operational plan that outlines how the goods or services will be produced. It includes details about:
- The production process and methods
- Machinery and equipment required
- Raw materials needed
- Quality control measures
- Production capacity and schedule
It ensures that production is carried out efficiently, on time, and within budget to meet customer demand.
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4Name the factors which affect the operational plan.Show solution
Answer:
The factors that affect the operational plan are:
1. Production/Manufacturing Process – The method and technology used.
2. Labour – Availability and skill of workforce.
3. Raw Materials – Availability, quality, and cost of inputs.
4. Physical Plant/Location – The place where production takes place.
5. Machinery and Equipment – Type and capacity of machines used.
6. Quality Control – Standards to be maintained.
7. Shipping and Distribution – How the product reaches the customer.
The factors that affect the operational plan are:
1. Production/Manufacturing Process – The method and technology used.
2. Labour – Availability and skill of workforce.
3. Raw Materials – Availability, quality, and cost of inputs.
4. Physical Plant/Location – The place where production takes place.
5. Machinery and Equipment – Type and capacity of machines used.
6. Quality Control – Standards to be maintained.
7. Shipping and Distribution – How the product reaches the customer.
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5How many sources of funds are available for arranging funds for business enterprises?Show solution
Answer:
Funds for a business enterprise can be arranged from the following two broad sources:
1. Internal Sources (Owner's Funds):
- Personal savings
- Retained earnings/profits
- Sale of assets
2. External Sources (Borrowed Funds):
- Bank loans and overdrafts
- Loans from financial institutions
- Venture capital
- Angel investors
- Issue of shares and debentures
- Government grants and subsidies
- Microfinance institutions
Thus, broadly there are two sources — own funds and borrowed funds.
Funds for a business enterprise can be arranged from the following two broad sources:
1. Internal Sources (Owner's Funds):
- Personal savings
- Retained earnings/profits
- Sale of assets
2. External Sources (Borrowed Funds):
- Bank loans and overdrafts
- Loans from financial institutions
- Venture capital
- Angel investors
- Issue of shares and debentures
- Government grants and subsidies
- Microfinance institutions
Thus, broadly there are two sources — own funds and borrowed funds.
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Let's Revise — C. Short Type Questions (75 words)
1Briefly, explain the objectives of an operational plan.
2Describe the contents of an organisational plan.
3Which common techniques are required to calculate the forecasting income?
4Write the steps in preparing a marketing plan.
5What is PAN? Why is it required?
Let's Revise — D. Long Type Questions (100 words)
1What is an operational plan? Discuss its blue print.
2Define organisational plan. A business can be classified in how many categories?
3How many choices are there to start a business by a businessman? Explain each of them.
4What are the key areas, for a sound financial plan to work?
5What are the major financial items that should be included in the financial plan?
Let's Revise — E. Long Type Questions (250 words)
1What is a business plan? Explain its importance.
2Describe the different elements of an operational plan.
3What is a financial plan? What are its objectives?
4Explain the investment decision under the financial plan. In which areas should the investment be on the basis of priority?
5What is manpower planning? Why is it necessary for every business unit?
6What is a marketing plan? Why is it required in business enterprises?
7Explain, in detail, the various formalities required to start a business.
F. HOTS (High Order Thinking Skills)
1A person has decided to start a small leather belt manufacturing unit. He/she is not aware of the various formalities involved in the process of setting up the unit. Explain to him/her the procedure.
G. Value Based Questions
1The first stage of a business plan is to come up with a business name. Supposing you are an entrepreneur, who is in the stage of deciding a business name for your enterprise, would you: (a) Keep the name of your enterprise, similar to one of the enterprises that are already doing really well in the same line of business? (b) Select/create a completely new name for your enterprise and create a brand name of your own? Give reasons. (Honestly)
2An entrepreneur is doing an industry analysis. While analysing competition, he/she realises that the competitors are far better in their business plans and execution. Should the entrepreneur add a unique selling point in the existing plan to get a creative niche above others, or should he/she go for a completely different line of business where the competition is less? Give reasons. (Creativity and problem solving)
3You are an entrepreneur deciding the operational plan. While deciding the technology to be used, you come across three alternatives: (a) Cheaper technology, dispose of waste water, fix low price. (b) Expensive technology, recycle waste water into drinking water, fix higher price. (c) Recycle waste, do not change price, cut costs through efficient resource utilisation. Give reasons for your selection of an alternative.
4An individual wants to start an enterprise that manufactures steam irons which can be imported from Germany. The material available in Germany is a little better in quality. However, there are no safety issues with the one available in India. Which material would you go for and why? (Social responsibility, import substitution)
5While doing manpower planning, an entrepreneur decides to keep less qualified manpower and give them low wages and salaries to enable higher profits. Do you think his/her approach is correct and justified, why?
6According to you, what kind of organisational set up is better – an autocratic form of an organization where there is absolute centralization of power and communication is from top to bottom, OR a democratic form of an organization where power is decentralized and communication is from both ends. Justify.
7Raghav, an entrepreneur realises that the enterprise he wants to start, has a potential risk of fire accidents because the production process poses such a threat. Should he develop strategies to: (a) Prevent the risk, (b) Respond to the risk, (c) Prevent as well as respond to the risk? Give reasons.
H. Activity Based Questions
1Devise a marketing plan for a clothing brand which uses CSR as a tool for marketing. Your marketing plan should include: (i) Pricing, (ii) Place, (iii) Promotion, (iv) Production forecasts, (v) Controls.
2You are an individual who wants to create an enterprise that produces chocolates. Develop a competition analysis, considering the giants that almost control the market (Nestle, Cadbury etc). Prepare a detailed SWOT analysis of your enterprise and devise a strategy that gives you an edge over your competitors.
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Ask a Doubt FreeFrequently Asked Questions
What are the important topics in Enterprise Planning for CBSE Class 12 Entrepreneurship?
Key topics in Enterprise Planning include Enterprise Planning Overview, Enterprise Planning Overview, Enterprise Planning Overview. These are the concepts CBSE Class 12 examiners draw on most — study them first, then practise related questions.
How to score full marks in Enterprise Planning — CBSE Class 12 Entrepreneurship?
Start by understanding all key concepts. Practise previous year questions from this chapter. Revise formulas and definitions regularly. Use flashcards for quick revision before the exam.
Where can I get free NCERT Solutions for Enterprise Planning Class 12 Entrepreneurship?
This page has free step-by-step NCERT Solutions for every exercise question in Enterprise Planning (CBSE Class 12 Entrepreneurship) — written the way examiners award marks: given, formula, working, answer.
Sources & Official References
- NCERT Official — ncert.nic.in
- CBSE Academic — cbseacademic.nic.in
- CBSE Official — cbse.gov.in
- National Education Policy 2020 — education.gov.in
Content is aligned to the official syllabus. Refer to the board website for the latest curriculum.
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