Q.Give reasons: A consumers co-operative society usually sells goods on a cash basis.

Selling for cash is a deliberate choice a consumers society makes to protect its limited funds.

It is true that most consumers co-operative societies sell goods only against cash payment, and there are sound reasons for this policy:

1. To avoid bad debts. A consumers society works with limited capital contributed by members of small means. If it sold on credit and some buyers failed to pay, the losses could quickly cripple it. Cash sales remove this risk almost entirely.
2. To keep the capital circulating. With cash sales, the money received is at once available to buy fresh stock. Credit sales, by contrast, lock up the society's scarce funds in unpaid bills and slow down its trading.
3. To keep costs and prices low. Giving credit means keeping accounts of debtors, chasing payments and bearing the cost of delayed money — all of which add to expenses. By selling for cash the society keeps its costs low and can pass the saving on as fair prices.
4. To protect the interest of all members. Credit given to a few careless members would ultimately be paid for by the honest members through higher prices or lost dividends. Cash sales keep the society fair to everyone. …

A 'give reasons' answer must actually give reasons with a 'because…' link, not just repeat the statement. Note that the same cash policy is prudent (an advantage internally) yet a limita …