eZine · Nigerian exams

Purchase and sale of goods

JAMB Commerce topic guide with 2 practice questions.

What to revise

  • procedure and documentation (enquiry, quotation, order, invoice, proforma invoice, statement of accounts, indent, consular invoice, bill of lading, certificate of origin, consignment note, etc.)
  • terms of trade (trade discount, quantity discount, cash discount, warranties, C.O.D., C.I.F., F.O.B. and E.O.E. etc.)
  • terms of payment: cash — spot/prompt payment
  • terms of payment: credit — meaning, types and functions, merits and demerits
  • means of payment: legal tender (bank notes and coins), cheques, standing order, bank draft, stamps, postal orders, money orders, bills of exchange, promissory note, mail transfer, traveller's cheques, telegraphic transfer, e-payment, recharge card

You should be able to

  • examine the procedures and documents used in the purchase and sale of goods
  • determine the terms of trade
  • distinguish between cash and credit forms of payment
  • explain the meaning and types of credit
  • analyse the merits and demerits of credit transactions
  • identify the means of payment

From JAMB's Commerce syllabus official. Full syllabus →

eZine's published bank has 17 questions on this topic (counted 29 October 2026).

Practice questions

Question 1 · Purchase and sale of goods

"E. & O.E." printed on an invoice means

Show answer and explanation

Answer: C. errors and omissions excepted

E. & O.E. means errors and omissions excepted: the seller reserves the right to correct mistakes. The other expansions are invented and have no commercial meaning.

eZine practice question (original, teacher-reviewed)

Question 2 · Purchase and sale of goods

The main difference between a bill of exchange and a promissory note is that

Show answer and explanation

Answer: A. a bill is an order to pay drawn by the creditor; a note is a promise to pay by the debtor

The creditor (drawer) draws a bill ordering the debtor to pay, while in a promissory note the debtor himself promises to pay. The option that says a note is drawn by the creditor and a bill is a debtor's promise reverses the two instruments; a bill has three parties (drawer, drawee, payee) and a note two, not the other way round; and neither is legal tender.

eZine practice question (original, teacher-reviewed)

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