Business Studies Trial Exams Paper 1 Questions - Alliance Boys High School Mock December 2020

Instructions to Candidate

Write your name and index number on the spaces provided.
Sign and write the date of examination on the spaces provided
Answer all the questions.
All the answers should be written on the spaces provided.
This paper contains 14 printed Pages.
The candidate should check the question paper to ascertain that all pages are printed as indicated and that no question is missing.
Candidates should answer the questions in English.

For Examiners use only

Question	1	2	3	4	5	6	7	8	9	10	11	12	13
Score

Question	14	15	16	17	18	19	20	21	22	23	24	25
Score

QUESTIONS

State four ways in which a well laid out business structure leads to the success of a business. (4 marks)
a............................
b............................
c............................
d............................
State four consequences that may arise due to poor arrangement of goods in a warehouse. (4 marks)
a............................
b............................
c............................
d............................
Distinguish between the following categories of government expenditure. (4 marks)
a) Recurrent expenditure
b) Capital expenditure
Sherwood traders had the following assets and liabilities as at 1st January 2019.
Shs.
Furniture 350000
Debtors 45,000
Cash 7,000
Creditors 48000
For the year ended 31st December 2019,
1. Additional capital was Shs. 24,000
2. Drawings were Shs.20,000
3. Net profit was Shs. 34,000
  Determine the capital as at 31st December 2019. (4marks)
The IMF has advised Kenya to scale down the number of Parastatals in the country for her to benefit from their loans. States possible reasons for such a move by the IMF. (4 marks)
a............................
b............................
c............................
d............................
Unemployment has been a major problem in Kenya, state four ways in which entrepreneurship can help solve this problem. (4 marks)
a............................
b............................
c............................
d............................
James is an onion farmer in Narok, highlight four ways in which he can improve the usefulness of his Onions, (4 marks)
a............................
b............................
c............................
d............................
State four circumstances that may lead to the creation of a monopoly. (4marks)
a............................
b............................
c............................
d............................
The following balances were obtained from the books of sunset traders as at 30th June, 2019.
Shs.
Stock 1st July 2019 45,000
Purchases 159,000
Sales 235,000
Stock 30/June/2019 33,000
Capital 75,000
Return outwards 3,000
Operating expenses 13,000
Calculate:
1. Stock turnover rate. (1 mark)
2. Gross Profit. (1 mark)
3. Net Profit (1 mark)
4. Return on capital. (1 mark)
Roy has been thinking of starting a printing firm after his graduation. Highlight four main considerations he has to make before implementing his idea.(4 marks)
a............................
b............................
c............................
d............................
List four stages in their order of occurrence in the historical development of money. (4 marks)
a............................
b............................
c............................
d............................
Highlight four uses of a Bill of Lading in international trade. (4marks)
a............................
b............................
c............................
d............................
The government licenses business activities for various reasons. State four such reasons. (4 marks)
a............................
b............................
c............................
d............................
Most firms are encouraging their employees to work from home. Highlight four advantages of this trend to the business. (4 marks)
a............................
b............................
c............................
d............................
State four items that are considered when computing the national income using expenditure approach.(4 marks)
a............................
b............................
c............................
d............................

In each of the following cases, state the type of inflation described. (4 marks)

CASE	TYPE OF INFLATION
The Covid-19 crisis has resulted to an increase in the price of oil
The price of maize flour has gone up to Shs.130 due to increase in the price of maize
A lot of money in circulation has led to the general increase of price.
A rise in price due to uneven growth in some sectors of the economy.

Study the letter below and answer the questions that follow

ALLIANCE HIGH SCH
P.O. BOX 7-00902
KIKUYU
5/12/2020

SALES MANAGER
BOOKS CENTER
P.O. BOX 52013
NAIROBI

Dear Sir,
RE............
We would be pleased to receive information regarding Mathematics books you stock, their prices, the quantities and titles that attract discounts. The delivery period as well as carriage terms.

Yours Faithfully
Principal

Identify the document. (1 mark)
Outline any three documents that the books center may choose to reply to the above letter. (3 marks)
i.........................................
ii.........................................
iii.........................................

Highlight four characteristics of tramp type of ships. (4 marks)
a............................
b............................
c............................
d............................
State four functions of the three-column cash book. (4 mark)
a............................
b............................
c............................
d............................

For each of the following transactions, indicate the effect of each transaction on the balance sheet items as either increase, decrease or no change. (4 marks)

Transaction	Effect on assets	Effect on liabilities	Effect on capital
Drawings of goods from the business
The proprietor brought a personal car for business use
Borrowed Equity bank loan to pay a creditor
Bought stock by cheque

State four circumstances under which an individual would prioritize his/her needs. (4 marks)
a............................
b............................
c............................
d............................
The government of Kenya has been emphasizing on achieving the 'Big Four Agenda'. State the four agendas. (4 marks)
a............................
b............................
c............................
d............................
Identify the type of ledger appropriate for the following accounts. (4 marks)
1. Land Account
2. Debtor Ezra Account
3. Creditor Kamau Account
4. Electricity Expense Account
State four important aspects that should be contained in an insurance policy. (4 marks)
a............................
b............................
c............................
d............................
The following information was obtained from the books of K. Mwangutu for the month of November 2020.
2^nd Nov.: Paid Mwangi's account of Sh. 15,000 by cheque, having deducted a cash discount of 10%
3^rd Nov.:Paid Juma in cash Sh. 9,500
22^nd Nov.:Cash purchases Sh. 15,200 was paid for by cheque of Sh. 14,000
30^th Nov.:Cash purchases paid by cheque of Sh. 9,000
Required: Prepare K. Mwangutu's relevant journal. (4marks)