Instructions to Candidates:
- Answer ALL questions
Questions.
- State the type of business described in each of the following activities.(4marks)
- Obtaining items from their natural state
- Combining wheat flour, sugar yeast and oil to come up with a loaf of bread
- Conversion of sugarcane into sugar
- Selling insurance policy to a bus company
- Highlight four disadvantages of long chain of distribution of products in local market (4marks)
- Outline four problems faced by a country that doesn’t undertake Development Planning 4marks)
- Mention four components of expenditure used in computation of national income through expenditure approach (4marks)
- The following are documents used in foreign trade, highlight one way in which each facilitates foreign trade. (4marks)
DOCUMENT FUNCTION IN FOREIGN TRADE CLOSED INDENT CONSULAR INVOICE LETTER OF CREDIT BILL OF LADING - Highlight four benefits of Standard Gauge Railway (SGR) to the Kenyan economy. (4marks)
-
- Define the term Double Entry Concept (1mk)
- The following assets and liabilities were obtained from the books of
Mwita traders on 25th Jan 2020.
Capital 120,000
Machinery 80,000
Creditors 10,000
Debtors 20,000
Stock 25,000
Bank 5,000
On 30th Jan, 2020, the following transactions took place;
Purchased goods worth kshs.15,000 on credit
Machinery was sold kshs 75,000 on credit
Required: Prepare Mwita’s Balance sheet as at 31/01/20202.(5marks)
- Outline four factors to be considered in planning office layout (4marks)
- The diagram below shows relationship between population and per capita income
Highlight four reasons why a country would prefer it’s population size to be at point P (4marks) - Highlight four reasons for locating bonded warehouses at the entry points of a country (4marks)
- Give the terms described in the following statements as used in public finance (4marks)
DESCRIPTION TERM I) Tax system where the poor
bear more burden than the richII) Funds borrowed by the
country to undertake activities
which do not generate further
revenueIII) Government borrowing
heavily from local financial
institutions denying local
investors funds to borrow
locallyIV) When tax is passed from seller
to the buyer through sale of
goods. - Outline four ways through which products are differentiated in monopolistic competition market. (4marks)
- Highlight four advantages to a business organization which operates a chain store. (4marks)
- Outline four Business considerations before investing in an opportunity (4marks)
- Highlight four importance of Kenya bureau of standards (KEBS) to the Kenyan Economy (4marks)
- The table below shows quantities demanded and quantity supplied of tomatoes in Kenya in the month of January 2020 at the prices shown.
Price in kshs Quantity demanded
in tonnesQuantity supplied in
tonnes20 800 200 40 600 300 60 550 380 70 400 400 80 300 500 90 250 600 110 100 700 - From the schedule above, prepare price mechanism (4marks)
- State the law of Demand (1mk)
- The following information was extracted from the books of Devante traders on 31/12/2019
Mark up 20%
Opening stock 90,000
Closing stock 150,000
R.O.S.T 3 times
Required:- Gross profit (2marks)
- Purchases (2marks)
- Outline four criteria used in classifying partners in partnership form of Business unit
- Give four current trends in money and banking in Kenya (4marks)
- Mention three reasons why businesses involve celebrities in advertising their products. (3marks)
- Highlight four disadvantages of division of labour in a production process (4marks)
- Outline four diseconomies of scale that a large firm may suffer from(4marks)
- Highlight the importance of the following insurance terms; (3marks)
- Surrender Value
- Annuity
- Consequential Loss
- Outline four ways through which central bank of Kenya may control deflation in the Kenyan economy. (4marks)
- The following relates to Kipkorir Merchants Ltd in January 2020.
4th Jan 2020 Purchased computers on credit from BML Ltd for Ksh.200, 000
17th Jan 2020 Sold an old tractor on credit to farm Ltd for Ksh.550, 000, the tractor costed ksh. 750,000 two years earlier
Required:
Enter the above transactions into General journal (4marks)
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