ASSIGNMENT # 3 Section A: Multiple Choice Questions (Maximum Mar s: !"# 1. Khalid and Hamid wants to start a carpenting business.

. Khalid will provide shop/premises and Hamid will provide the tools, both will work in the business. This is a. Shirkah-almilk b. Shirkah-al-amwal c. Shirkah-alaamal d. Shirkah-alwojooh . !hat is the status o" a current account in #slamic bank$ a. Shirkah b. %ard c. !adeeaah &. 'or which purpose can (urabaha be used$ a. )urchasing o" raw material b. )a*ment o" sta"" salar* c. 'or +verhead ,-penses .. ,-cess compensation without due consideration is called/ a. 0iba b. 1abour c. Salam d. #stisna 2. The ideal product "or 3+T is/ a. (urabaha b. Salam c. #stisna d. #jarah 4. Sale in which 5ost is not known is called/ a. (urabah b. (uajjal c. (u6a*ada d. (usawamah 7. The kind o" sale in which pa*ment is spot while the deliver* o" the good is de"erred is called/ a. #stisna b. Salam c. #stijrar d. #jarah 8. #" (udarabah become void due to an* reason (udarib will be/ a. Shareek b. 9amin c. :jeer d. !akeel ;. The agreement between 3ank < Saving account holder is a. %ard b. Shirkah c. (udarabah d. (udarabah (ushtarikah 1=. : >inning 'actor* asks "inancing "or advance pa*ment to the "armer and "or it overhead ,-penses, which product is suitable/ a. (urabaha b. Salam c. #jarah d. Taka"ul 11. )artnership b* ?oint +wnership is re"erred as/ a. Sirkat-ul-(ilk b. Shirkat-ul-:6d c. Shiekat-ul-!ujooh d. Shirkat-ul-:in 1 . )artnership in 5apital is re"erred as/ a. Shirkat-ul-!ujooh b. Shirkat-ul-:mal c. Shirkat-ul-:mwal d. Shirkat-:l-(u"awada 1&. #n (udarabah, (udarib is known as a. #nvestor b. !orking )artner c. :gent d. Trustee 1.. !hich one o" the 'ollowing is @+T the role o" mudarib/ a. !akeel b. Trustee c. :gent d. #nvestor 12. The Transaction in which cost and pro"it are known is re"erred as/ a. (usharakah b. (urabaha c. #jarah d. Salam 14. #' a person provide wood to the carpenter "or manu"acturing a o""ice table this product is called a. Salam b. #stisna c. #jarah d. (urabaha 17. !hich one o" the "ollowing is @+T the part o" 0iba :l-"adl/ a. Aate b. Silver c. Begetable d. !heat 18. !hich one o" the 'ollowing is @+T the element o" Balid Sale/ a. )rice b. Aeliver* c. Bariet* d. 5ontracting )arties 1;. :n*thing that is in the possession o" the person, who is not the owner o" it, is called/

a. :manah b. :min c. :mal d. :l-!adiah =. :n agreement e""ected b* mutual understanding is called/ a. :6l b. :rdh c. :sl d. 5ontract 1. (urabaha is basicall* a sale purchase contract. #n this contract CCCCCCCCC is responsible to disclose the cost and pro"it o" the asset subject to (urabaha contract$ a. Supplier o" goods b. bu*er o" goods c. Seller o" goods . Auring the transactional hierarch* o" (urabaha "inancing Dwhen an #slamic bank appoints its client as its agentE at what stage the relationship between the client and the #slamic bank is changed "rom the agent and principal to bu*er and seller$ a. !hen client e-ecutes #n"ormation (emorandum "or taking possession o" goods b. !hen client o""ers #slamic bank to purchase the goods on (urabaha basis c. !hen #slamic 3ank accepts the o""er made b* the client "or the purchase o" the goods on (urabaha basis &. #" an #slamic bank does not appoint its client as its agent, and the client procures some goods, then what will happen i" client needs (urabaha "inancing a"ter procurement o" goods$ a. :lkhiraj 3iddaman D0isk sharingE b. 3ai-Fddain DAebt tradingE c. 3ai-#nnah D3u* backE .. Since (urabaha selling price is "i-ed at the time o" e-ecuting (urabaha contract b* picking-up prevailing matching K#3+0, accordingl* what kind o" risk, the 0isks (anagers o" #slamic banks "oresee while e-tending long term (urabaha "inancing$ a. 0ate o" return risk b. 5ommodit* risk c. (arket risk 2. 5onstructive li6uidation o" (udarabah business in an #slamic bank means a. +btaining market surve* report to evaluate the market price o" assets b. Aistribution o" pro"it among 0abb- ul-(aal and (udarib c. Arawing up pro"it and loss account on monthl* basis 4. Aisclosing contractual obligation "or the pa*ment o" lump sum amount o" (udarabah pro"it results the (udarabah contract CCCCCCCCCCC a. valid DSahihE b. void ableD'asidE c. invalid D3atilE 7. :"ter "i-ing the (urabaha selling price, the roll over o" the same, like 0unning 'inance 'acilit* will be regarded as CCCCCCCCCC a. 3ai-amanah b. sale on sale c. 3ai-uddainDdebt tradingE 8. (udarabah is a CCCCCCCCCCCCbased contract and thus can be terminated b* an* single part* at an* given date. a. partnership b. pro"it c. trust ;. The original old principal o" (udarabah is that CCCCCCCCcan not mi- his/its e6uit* with the e6uit* o" 0abb-ul-(aal a. 3ank b. depositor c. (udarib &=. :"ter introduction o" (usharakah on the liabilit* side, as a new mode o" "inance as a new version o" Shirkah conceptE it has been practiced like a. mi-ing-up e6uit* o" the bank with depositors and sharing pro"it < loss in an agreed ratio b. mi-ing-up e6uit* o" the bank with the depositors and sharing pro"it < losses to the e-tent o" e6uit* participation and taking pro"it in the capacit* o" (udarib b* the bank c. 5reating a joint pool o" investment with the depositorsG mone* &1. The most signi"icant di""erence between conventional and #slamic banking "or earning returns on principal amount o" depositors is basicall* a. pro"it < loss sharing between bank and depositors b. Aisclosure o" pro"it sharing ratio as against disclosure o" percentage o" pro"it attached with the capital/investment o" the depositors c. :lkhiraj 3iddamanDrisk sharingE & . :t the time o" conclusion o" Salam contract it is obvious that CCCCCCCCCCC a. goods do not e-ist b. good ma* e-ist but ma* not be in the ownership o" the seller c. the seller is liable to give either constructive or actual possession to the bu*er

&&. The most signi"icant "eature o" #stisnaGa mode o" "inance is that the goods CCCCCCCCC a. have to pass through manu"acturing process b. do not owned b* the seller c. ma* be o" some special kind &.. The loss i" an* is distributed among more than the ratio o" their CCCCCCCCC a. pre-agreed ratio o" pro"it b. pre-agreed ratio o" loss c. ratio o" investment &2. The (udarbah business CCCCCCCC terminated singl* either b* 0abb-ul-(aal or (udarib a. ma* be b. ma* not be c. must be &4. There are CCCCCsteps in (urabaha Aocuments < Se6uence/ a. Three b. 'our c. 'ive d. Si&7. Shirkat-ul-:6d is "urther divided into/ a. Two t*pes b. Three t*pes c. 'our t*pe d. @one above. &8. #n Shirkat-ul-(ilk undivided shares or other assets can be used in the/ a. (ushtarik #nti"a b. (uha*a c. Ta6seem d. :ll above &;. (usharaka is a relationship established b* the parties through/ a. : (utual contract b. : Berbal contract c. 3oth d. @one o" above .=. #n case o" (usharakah agreement between the 3ank and the client, the bank shall CCCCCC, obtain ade6uate securit* "rom the part*/ a. Shall has right to obtain securit* "rom the part*. b. Shall not has right to obtain the securit* "rom the part*. c. 5annot obtain the securit* d. @one o" above. .1. The di""erence between interest based "inancing and (usharakah/ a. : "i-ed rate o" return b. : variable rate o" return c. :greed rate o" return d. :ll above. . . #mam Sha"i has an opinion dividing commodities into/ a. Two b. Three c. 'our d. @one .&. Aiminishing (usharakah is also called/ a. Shirkah-al-(utana6isah b. Shirkah-al-:mwaal c. 3oth above d. @one above. ... Aiminishing (usharaka can be used as mode o" 'inance in CCCC e""ectivel*/ a. 5ar 'inancing b. House 'inancing c. 0unning 'inancing d. @one o" above. .2. There are CCCCt*pes o" Aiminishing (usharakah a. Two t*pes b. Three t*pes c. 'our t*pes d. @one o" above. .4. There are CCCC t*pes o" (udaraba a. Two b. Three c. 'our d. @one above. .7. #n (udaraba, (udarab will be liable o" loss/ a. #n an* case b. #n case o" misconduct c. #n case o" will "ull negligence d. b and c above. .8. :t the time o" termination o" (udarabah/ a. :ccrued #ncome is the 3asis +" Sharing )ro"it b. )a*ment o" )ro"it is not the part o" 3ankGs ,-penses and >ross revenue is shared between 3ank and deposit holders c. )ro"it is calculated on dail* product basis Dmeans each da* average balance is calculated as against minimum balance basis o" conventional banksE d. :ll above. .;. (ajor maintenance o" asset under #jara agreement is responsibilit* o"/ a. 1essor b. 1essee c. 3oth d. @one above. 2=. )rocurement o" #nsurance DTaka"ulE is responsibilit* under #jara agreement is/ a. 1essor b. 1essee c. 3oth d. @one above

Section $: True or %alse (Maximum Mar s: !"# 1. The actual and "resh purchase is an essential part o" (urabaha . :hmed and !a6as wants to start a hotel business. :hmed will provide shop/premises and !a6as will provide the e-pertise, both will work in the business. !a6asG share can be purchased b* mutual consent at an agreed "inal price without ph*sical or constructive li6uidation. &. #n Shirkah-al-:6d one partner can promise be"orehand at the time o" e-ecution o" agreement to purchase the other partnerGs share at a "i-ed price. .. The customer owns a plot o" land and the bank provides "und "or construction b* e-ecution o" (usharakah :greement, The customer cannot purchase the bankGs share/units be"ore one *ear. 2. #n 5ar #jarah, the vehicle had an accident the repair work took & months, during which the vehicle was not usable and the customer/lessee liable to pa* rent "or the & months$ 4. 3ank gave Khalid as an agent 0s1== "or purchasing o" a pen on 8th ?une, Khalid purchased pen on 12th ?une, bank can e-ecute (urabaha o""er acceptance on 8th ?une . 7. Khalid can e-ecute a salam agreement "or purchasing o" (ango o" HameedGs 'arm . 8. Aeposit side o" an #slamic bank can be structured on the basis o" Shirkat-ul-:6d. ;. #slamic Shariah does not permits one to do a sale transaction contingent on a "uture date. 1=. : small mistake at an* stage ma* convert (urabaha into an interest based loan. 11. ,ver* partner has the right to terminate the (usharakah at an* time a"ter giving his partner a notice 1 . #n case o" loss the burden o" loss will not "all upon one rather will be shared b* all "irms o" the partner. 1&. Aiminishing (usharakah is a t*pe o" Shirkah where one partner purchases the other partnerGs share graduall*. 1.. #n Shirkat-ul- :6dH @o pro"it I )rincipal is guaranteed 12. #n Shirkat-ul- (ilk, )rincipal can be guaranteed and unit price can be "i-ed. 14. : (udaraba contract is one o" a pro"it-based contracts 17. #n (udarabah, )h*sical li6uidation is necessar*. 5onstructive li6uidation cannot be conducted. 18. There is no di""erence between #jara and 1ease. 1;. #n Salam transaction, the )rice is in cash but the suppl* o" goods is de"erred. =. The purpose o" Salam is to meet the need o" small "armers who need mone* to grow their crops and to "eed their "amil* up to the time o" harvest. 1. #t is not necessar* "or the validit* o" Salam that the bu*er pa*s the price in "ull to the seller at the time o" e""ecting the sale. . #n Sallam, be"ore deliver*, goods will remain at the risk o" seller. &. :"ter deliver* under Sallam transaction, there will not be an* Kha*ar D+ptionE with the bu*er. .. There is no di""erence in condition between Salam < #stisna.

2. )arallel Salam is not possible and not approved in #slamic Shariah 4. : Salam arrangement can be used as a bu* back "acilit* 7. )rice o" #stisna ma* be in the "orm o" mone*, commodit* and usu"ruct 8. @o securit* can be obtained or re6uired under #stisna contract. ;. )arallel #stisna is possible in Shariah &=. #stisna < Sallam is the same contracts &1. #stisna can onl* be used in (anu"acturing orders & . (urabaha transaction can be used to "inance the purchase o" an* assets which is recogniJed as (al-e-(uta6awam DBaluableE under Shariah. &&. The actual and "resh purchase is not an essential part o" (urabaha &.. 0oll over o" (urabaha is possible &2. The literal meaning o" (usharaka is sharing &4. Shirkat-ul-(ilk is also called (usharaka &7. @o capital investment is essential in Shirkat-ul-wujooh$ &8. The capital in a (usharaka should be necessaril* %uanti"ied < Speci"ied. &;. The Shirkah cannot be terminated be"ore a stipulated time. .=. (urabaha is not a mode o" "inancing in his nature. .1. There is no di""erence between (usharaka < Aiminishing (usharaka . . #n Aiminishing (usharaka, sale and purchase o" units in di""erent stages is not permitted. .&. Aiminishing (ushraka is not possible in more than two partners. ... #n Aiminishing (usharaka, :sset will be purchased and each will be owner o" this asset as per ratio o" his investment. .2. Aiminishing (usharkah cannot be used "or construction o" House. .4. #n #jara "acilit*, the rent will be charged during major maintenance o" the assets. .7. #n case o" accident and in the event o" total loss o" the assets, the #jarah contract will stand terminated automaticall*. .8. The share o" the loss will be distributed e6uall* in (odarabah :greement. .;. The pro"it will be according to the ratio o" capital in (usharakah. 2=. 0abul (aal has all rights "or the management o" the business under (udarabah agreement.

Student Name Registration Code Date of Submission

Md. Jaker Hossain CIFE.346.CA.265 February 11 2010

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