BUSINESS STUDIES PAPER 1 - 2019 KCSE Prediction Questions Set 2

INSTRUCTIONS

• Answer all questions

1. State the circumstances under which human wants becomes;   (4mks)
   1. Competitive
   2. Repetitive
   3. Habitual
   4. Complementary
2. Give four features of capital as a factor of production (4mks)
3. Mr. Kamau has a business in Nakuru town. His business has been doing well. Give four reasons for success of his business. (4mks)
4. Name four characteristics of a good filing system (4mks)
5. The following are occupations for different level of production. Give the nature of activities (4mks)
   Occupation                                                                  nature of activities
   1. Maize milling                                                       ____________________
   2. Bread banking                                                     ____________________
   3. Railway construction                                            ____________________
   4. Wholesaling                                                         ____________________
6. Outline the benefits of using internet in transacting business in an organization (4mks)
7. State four characteristics of government owned corporations (4mks)
8. Highlight on four disadvantages of government participation in business activities (4mks)
9. Give four circumstances under which air transport will be appropriate as a means of transport (4mks)
10. Despite wide use of cell phone landline continue to be in existence. Give four reasons for continued existence of landline phones (4mks)
11. State four ways in which warehousing facilitates trade in a country (4mks)
12. Outline benefits of poling of risks to an insurance company (4mks)
13. List any four ways of determining price of commodity (4mks)
14. State four advantages of delocalization of firms (4mks)
15. Highlight on four features of monopolistic competition (4mks)
16. State four drawbacks encountered in comparing standards of living in different countries using national incomes (4mks)
17. Outline the four causes of unemployment in Kenya (4mks)
18. Using balance sheet equation, fill the figures in the table (4mks)
    Capital                                 Liabilities                       Assets
    21920                                   ...………                          30341
    …………                                   73000                           100920
    62470                                    58940                           ………….
    ……....                                    210560                         475120
19. In the course of preparing his balance sheet as at 31^st dec. 2003 Karanja found that he had capital amounting to sh. 120000 in his business. During the year investments totaled to sh. 50000 while drawings were sh. 56000. Calculate his initial capital as at 1^st jan. 2003 if profits was sh. 38000 (4mks)
20. Complete the following table by indicating the account to be debited /credited (4mks)
    Transaction                                                       Account (DR)                           Account (CR)
    1. Started a business with sh. 50000 in cash     …………………                               ………………
    2. Received a cheque from a debtor                  …………………                               ………………
    3. Bought office equipment by cheque               …………………                               ……………..
    4. Paid creditor in cash                                     …………………                               ……………..
21. State two reasons why the three column cashbook is both a ledger as well as a book of original entry (4mks)
22. Outline the four importance of books of original entry (4mks)
23. The following relates to Kagwiria books of accounts (4mks)
    

    	Ksh
    Gross profit	130000
    Salaries and wages	8000
    Rent Received	20000
    Insurance	8000
    Discount allowed	1000
    Discount received	3000
    Carriage on sales	9000
    Power and lighting	5000

    Prepare a profit and loss account for the period ended 31^st dec. 2005
24. Enumerate on four functions of micro finance companies (4mks)