ExpertEasy2 marksMultiple Choice
Syllabus A: The business organisation and its external environmentSyllabus AOrganizational TypesCooperatives
ACCA · Question 05 · Syllabus A: The business organisation and its external environment
Section A
GreenYield is an agricultural organization owned entirely by the farmers who supply raw produce to it. The organization processes the produce and shares the profits back to the farmers based on the volume of produce they supplied, rather than capital invested. What type of organization is GreenYield?
Section A
GreenYield is an agricultural organization owned entirely by the farmers who supply raw produce to it. The organization processes the produce and shares the profits back to the farmers based on the volume of produce they supplied, rather than capital invested. What type of organization is GreenYield?
Answer options:
A.
A mutual society
B.
A cooperative
C.
A non-governmental organization (NGO)
D.
A public limited company
How to approach this question
Recognize the ownership structure: owned by suppliers/members, profits distributed based on participation (volume supplied). This is the classic definition of an agricultural cooperative.
Full Answer
B.A cooperative✓ Correct
A cooperative is an organization owned and controlled by its members (who can be customers, employees, or suppliers). In agricultural cooperatives, farmers pool resources and share profits based on their level of trade with the cooperative, rather than capital investment.
Common mistakes
Confusing cooperatives with mutuals. Mutuals are usually customer-owned financial institutions (like building societies).
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