Parts of a Business Letter and Trade Letters (ISC Class 12)

Understand Parts of a Business Letter and Trade Letters

Parts of a Business Letter and Trade Letters: key facts

Parts of a letter

• •Letterhead
• •Reference and date
• •Inside address
• •Salutation
• •Subject
• •Reference line
• •Body
• •Close
• •Signature
• •Enclosures

Learn the order.

Order letter checklist

• •Quantity
• •Quality
• •Price
• •Total
• •Packing
• •Delivery
• •Payment
• •Reference
• •Acknowledgement

Every item counts.

Reply to a complaint

• •Acknowledge
• •Apologise
• •Cause
• •Remedy
• •Assure

Goodwill is the aim.

How to answer Parts of a Business Letter and Trade Letters questions

1. 1Identify who writes to whom, and which letter it is, so sender and receiver are not interchanged.
2. 2Write the parts in order, using only the details supplied, with a fictional reference number if needed.
3. 3Include every essential detail for that letter (for an order: quantity, price, packing, delivery, payment).
4. 4Calculate totals and discounts correctly, close with Yours faithfully (after Dear Sir/Madam) and sign with name and designation.

Parts of a Business Letter and Trade Letters in real life

The idea, met in an everyday situation. Answer the question in your own words, then compare with the model answer. The one-line hook is what to remember.

Tricks to remember Parts of a Business Letter and Trade Letters

Short memory aids. Say each one aloud once, then use it on a question the same day.

• LR-I-S-S-R-B-C-S-E

  Letterhead, Ref and date, Inside address, Salutation, Subject, Reference line, Body, Close, Signature, Enclosures.

  Use it when: Recalling the order of the ten parts.

• Enquiry asks, quotation tells, order buys

  Buyer asks (enquiry), seller tells (quotation), buyer buys (order).

  Use it when: Seeing who writes each letter.

Parts of a Business Letter and Trade Letters: solved examples

Ordered from board level to HOTS. Try each one before you open the solution.

Where students lose marks in Parts of a Business Letter and Trade Letters

The slips examiners see most often, and what to write instead.

• ✗Mistake: Sender and receiver interchanged

  CISCE examiners' comments mention format errors such as interchanged sender and receiver, as noted on the chapter page.

  Wrong working

  Letterhead of the seller on an order letter written by the buyer.

  Right working

  Letterhead of the buyer; inside address of the seller.

  ✓Do this: Underline who is writing before you begin.

  Usually costs: 2-3 marks.

• ✗Mistake: Missing essential details in an order

  Students omit packing, delivery or payment terms.

  Wrong working

  Please supply 100 files soon.

  Right working

  Please supply 100 files of the quoted quality at the quoted rate, packed in cartons, by 20 July by road, payment within 30 days.

  ✓Do this: Run through the checklist.

  Usually costs: 1-2 marks.

• ✗Mistake: Wrong signatory or no designation

  An order is signed by the buyer's Purchase Manager.

  Wrong working

  Signed by the Sales Manager of the buying firm.

  Right working

  Signed by the Purchase Manager, with name and designation.

  ✓Do this: Match the signatory to the department.

  Usually costs: 1 mark.

Practice questions on Parts of a Business Letter and Trade Letters

Write each answer on paper first. Open the hint only if you are stuck, and the answer only when you have finished.

1. Q1 · 1 mark · Very short answerBoard level

   Name the part of a letter that states in brief what the letter is about.

   Hint

   Topic line.

   Answer

   The subject line.

2. Q2 · 2 marks · Short answerBoard level

   State any two functions of business correspondence.

   Hint

   Record and goodwill.

   Answer

   It conveys information; serves as a permanent record and legal evidence; builds goodwill; reaches distant parties cheaply (any two).

3. Q3 · 2 marks · Short answerHarder board level

   A buyer orders 50 chairs at Rs 700 each and 5 tables at Rs 3,200 each, less 10% trade discount. Calculate the net amount payable.

   Hint

   Add, then discount.

   Answer

   Chairs: 50 x 700 = Rs 35,000. Tables: 5 x 3,200 = Rs 16,000. Total Rs 51,000. Discount 10% = Rs 5,100. Payable = Rs 45,900.

4. Q4 · 4 marks · Short answerHarder board level

   Suppose a customer received 24 plates of which 6 were cracked. Explain what the complaint letter must contain and what the reply from the seller must contain.

   Hint

   Facts, remedy, goodwill.

   Answer

   Complaint: order reference and date, the fault (6 of 24 plates cracked), the remedy wanted (replacement or credit), a reasonable time, polite tone. Reply: acknowledge, apologise if at fault, explain the cause, offer replacement or credit note, assure better packing.

5. Q5 · 4 marks · Short answerHOTS / competency

   A seller's quotation says the rate is valid for 15 days from 1 June. The buyer orders on 20 June at the quoted rate. Advise the buyer about the risk and what the order letter should say.

   Hint

   Validity period.

   Answer

   The quotation expired on 16 June, so the seller need not honour the rate. The buyer should first confirm that the rate still holds; the order letter should refer to the quotation and that confirmation, and state quantity, price, delivery and payment terms.

Test your recall

Answer in your head or on paper first, then open the card. Pulling an answer out of memory makes it stick far better than re-reading.

1. 1.Who writes a letter of enquiry?Show answer

   The prospective buyer.

2. 2.Who signs an order letter?Show answer

   The buyer's Purchase Manager.

3. 3.What does a quotation contain?Show answer

   Prices, trade discount, delivery and payment terms, validity.

4. 4.What is the standard salutation and close?Show answer

   Dear Sir/Madam is closed with Yours faithfully; a named salutation such as Dear Mr/Ms [Name] is closed with Yours sincerely.

Parts of a Business Letter and Trade Letters: frequently asked questions