5. What is Life Insurance? Accident Insurance? Marine Insurance? Employers' Liability Insurance? Exercise 57-Written. 1. A stock of merchandise valued at $5,000. is insured at 45¢ per $100.; what is the premium on this policy? 2. A building valued at $8,000. is insured for 90% of its value at $1.20 per $100.; what is the premium? 3. A vessel worth $200,000. is insured for 80% of its value at 41%, and its cargo, worth $450,000., is insured for 90% of its value at 43%; what is the total premium on the two policies? 4. A man aged 30, insured his life in favor of his wife for $10,000., agreeing to pay an annual premium of $20.50 per $1,000. as long as he lived. He died at the age of 50. How much had he paid in premium during the 20 yr.? How much did his wife get from the insurance company? 5. If a premium of $80.00 was paid for insurance at 1% to cover of the value of my house, what was the value of my house? LESSON 26 Commission and Brokerage " is an You have already learned that "commission' amount of money which is paid by one person who is called the "principal" to another person who is called the "agent," for some service which the agent performs for the principal. A "commission merchant" is one who sells produce or merchandise of a similar nature for his principal; however, while an ordinary salesman who sells on commission assumes no responsibility in regard to collecting for the goods he sells, a commission merchant is the loser if he fails to collect for the merchandise he sells. A shipment of merchandise to be sold by a commission merchant is called a "consignment," and the amount of money which is to be paid to the principal after commissions and all other charges are deducted is called the "net proceeds. A "broker" also sells on a percentage basis, but his business is usually confined to real estate, stocks, bonds, etc. The amount he receives for his work is called the "brokerage." Exercise 58—Oral. Commission and Brokerage Project Select two girls to be real estate brokers, and two boys on the opposite side of the room to be commission merchants. 1. (The commission merchants are to impersonate Henderson & Co.; one of the pupils can impersonate John Smith, the shipper; others can impersonate the buyers; others can ask the questions shown; everyone may ask for information.) John Smith, who owns a fruit farm in Michigan, sent 100 crates of berries to Henderson & Co., Commission Merchants, Chicago, Illinois. (a) In this transaction, who is the principal? (c) What did this consignment consist of? 2. (The real estate brokers are to impersonate Frederick Sharp; others can impersonate the seller, Henry Wise; others can impersonate the buyer; others can ask the questions shown; everyone may ask for information.) A real estate broker named Frederick Sharp sold a farm belonging to Henry Wise for $10,000., receiving 5% as his brokerage. (a) In this transaction, who is the principal? (c) Who is the broker? (d) How much brokerage was paid? Who received it? (e) What did the net proceeds amount to? Who received them? Now some may ask these questions and others may answer; the real estate brokers must be ready to settle any point about brokerage; the commission merchants must be ready to settle any point about commission. 3. In commission and brokerage, who is the principal? 4. Who is the agent? 5. What is a commission merchant? 6. What is a real estate broker? 7. What is the amount called which a commission merchant receives for his services? or less than 100%? Is it more 8. What is the amount called which a principal receives? Is it more or less than 100%? 9. What is the amount called which a broker receives for his services? Is it more or less than 100%? 10. State whether commission or brokerage was paid on the following transactions, and give the amount so paid: (a) The sale of merchandise amounting to $500. at 6%; (b) The sale of fruit amounting to $300. at 12%; (c) The sale of produce amounting to $800. at 8%; (d) The sale of a house and lot for $8000. at 5%; (e) The sale of Liberty Bonds for $800. at %. age, etc., amounted to $4.50; what amount of commission was paid? What did the net proceeds amount to? 2. What is the commission at 4% on 50 baskets of peaches sold at 60¢ per basket? 3. The commission on the sale of a certain lot of merchandise was paid at the rate of 8% and amounted to $32.00; what was the amount of the sale? 4. A consignment of 3,465 bu. of wheat was sold at 83 per bu.; what was the agent's commission at 21%? 5. A house and lot was sold for $6,575.00; the brokerage was 4%, and the attorney's fees, etc., amounted to $37.00; what were the net proceeds of this sale? If you were the broker, how would you send this money to the principal? Why? 6. If the brokerage on the sale of a certain farm was paid at the rate of 31% and amounted to $140.00, for what amount was the farm sold? How many acres were there if the price per acre was $50.00? 7. If 8% commission on the sale of a consignment of potatoes amounts to $11.40, and the potatoes were sold at $4.75 per bbl., how many barrels were there in the consignment? 8. The net proceeds from the sale of a consignment of eggs amounted to $38.40; if 4% commission was charged by the commission merchant, what amount was received for the eggs? 9. The net proceeds from the sale of a consignment |