Instructions to candidates
- Write your name and adm. no in the spaces provided above.
- Sign and write the date of the examination in the spaces provided above.
- This paper consists of six questions.
- Answer any five questions in the answer booklet provided.
- All questions carry equal marks.
- Candidates should answer the questions in English.
For examiner’s use only
Questions |
Maximum Score |
Candidates Score |
1 |
20 |
|
2 |
20 |
|
3 |
20 |
|
4 |
20 |
|
5 |
20 |
|
6 |
20 |
|
|
TOTAL SCORE |
|
Questions
-
- Explain five benefits that would accrue to Country as a result of delocalization. (10mks)
- Explain five features of a perfect competition market structure (10mks)
-
- The following transactions relate to Vivylex wholesalers for the month of December 1998.
1998
Dec. 1 Bought goods on credit from Weka Distributors sh.46,200, Micko sh15,600 and Limo shs38,360.
3 Sold goods on credit to Lwanda Retailers shs.39,200, Motor Grocers sh.25,560 and Mawe shs.12,650.
7 Returned goods to Micko sh4,200 and Limo shs6,140.
11 Bought goods on credit from Tuktuk sh34,830.
12 Goods returned by motor Grocers hs4,550 and Lwanda Retailers sh1,280.
15 Sold goods on credit to Motor Grocers shs6,800, Marion traders shs12,800.
18 Goods returned by Marion Traders shs2,060.
22 Bought goods on credit from Fatuma shs22,100, Temo shs38,350.
28 Credit sales to Ngula shs16,060, Oyunga shs12,960 and Mawe shs15,260.
Enter the above transaction in the respective books of original entry (10mks) - Discuss five factors that enhances efficient running of a warehouse. (10mks)
- The following transactions relate to Vivylex wholesalers for the month of December 1998.
-
- Explain five negative effects of inflation to a country’s economic development.(10mks)
- Highlight five importance of entrepreneurship to the economy of a country. (10mks)
-
- Explain five factors that can lead to unfavourable balance of payment. (10mks)
- Explain five factors to be considered when choosing a method of product promotion (10mks)
-
- Describe five procedure to be followed when taking an insurance policy. (10mks)
- Explain five limitations of containerization in transport sector. (10mks)
-
- Highlight five benefits that a country will enjoy as a result of indirect production(10mks)
- The following trial balance was extracted from the books of Mugoya Traders as at 30th June, 2014
Mugoya Traders
Trial balance
As at 30th June 2014
Details
Dr (shs)
Cr (shs)
Premises
1,500,000
Debtors and creditors
20,000
30,000
Cash at bank
90,000
Cash in hand
10,000
Purchases and sales
140,000
320,000
Stock of good on 1st July 2013
45,000
Discounts
6,000
2,000
Salaries and wages
50,000
Commissions
8,000
Power and lighting
12,000
Returns
15,000
19,000
Carriage outwards
2,300
Carriage inwards
5,400
Capital
1,543,700
Furniture
27,000
1,922,700
1,922,700
Stock of goods on 30th June, 2014 was worth sh22, 000.
Required: prepare trading, profit and loss account for the period ended 30th June, 2014. (10mks)
MARKING SCHEME
-
- Explain five benefits that would accrue to Country as a result of delocalization. (10mks)
- reduced income disparities - people have access to jobs/income
- better auxillary services - rural areas develop
- increased job opportunities - leading to better standards of living
- increase use of locally available resources/ factors of production
they earn income
would otherwise have been idle - imrpoved stsandards of living - rural development leads to variety increased / improved goods and services
- reduced urban migration/ congestion in towns - reduced pressures on urban resources
- balanced economic/ regional development - as firms or economic activities are spread throughout the country
- technology skills transfer - leading to improved productivity
- infrastructural development - opens rural areas to development
- facilitates movement of goods or services - improved/development of social facitlities - leading to improvement in welfare in rural areas
- minimized effect of pollution - negative on health
- market for raw materials/goods produced in area
- minimises effects of calamities that would paralyse country
- Explain five features of a perfect competition market structure (10mks)
- large number of buyers and sellers
- uniformity of product
- limiting factors to entry
- no government interference
- perfect knowledge by buyers and sellers
- demand or supply determine the market price
no excess demand and supply to market - perfect mobility of factors of production
- no transport costs
Any 5 well explained
- Explain five benefits that would accrue to Country as a result of delocalization. (10mks)
-
- The following transactions relate to Vivylex wholesalers for the month of December 1998.
1998
Dec. 1 Bought goods on credit from Weka Distributors sh.46,200, Micko sh15,600 and Limo shs38,360.
3 Sold goods on credit to Lwanda Retailers shs.39,200, Motor Grocers sh.25,560 and Mawe shs.12,650.
7 Returned goods to Micko sh4,200 and Limo shs6,140.
11 Bought goods on credit from Tuktuk sh34,830.
12 Goods returned by motor Grocers hs4,550 and Lwanda Retailers sh1,280.
15 Sold goods on credit to Motor Grocers shs6,800, Marion traders shs12,800.
18 Goods returned by Marion Traders shs2,060.
22 Bought goods on credit from Fatuma shs22,100, Temo shs38,350.
28 Credit sales to Ngula shs16,060, Oyunga shs12,960 and Mawe shs15,260.
Enter the above transaction in the respective books of original entry (10mks)
Purchase day book /journal date details folio amount Dec 1 weka 46200 1 mioko 15600 1 limo 38360 11 taktak 34830 22 fatuma 22100 22 temo 38350 sales daybook journal date details folio amount Dec 3 lwanda 39200 3 motor grocers 25560 3 mawe 12650 15 motor grocers 6800 15 marion traders 12800 ngula 16060 oyunga 12960 mawe 15260 sales returns journal date details folio amount dec 12 motor gorcers 4550 12 lwanda retailers 1280 18 marion traders 2060 purchase returns journal date details folio amount dec 7 micho 4200 7 limo 6140 - Discuss five factors that enhances efficient running of a warehouse. (10mks)
- labour - skilled/adequate to hndle volume of goods
- record keeping / documentation - should be good to enable monitor of movemnt of goods
- spacious - adequate / big to accomodate volume of goods
- adequate/relevant equipment / handling facilities for ease of movement
- adherence to legar requirements - to avoid conflict with the government
- presence of storage facilities - for preservation of goods
- goods maintain quality - security/ safety measures - to avoid theft/loss/damage
- protection of employees - building design / structure - acceptable standards to handle goods dealt in
- The following transactions relate to Vivylex wholesalers for the month of December 1998.
-
- Explain five negative effects of inflation to a country’s economic development.(10mks)
- discourage savings
- increases interest rates
- people with fixed incomes negatively affected
- lenders lose
- socialpolitical unrest
- worsening balance of payments
- low income earners
- invetments decreases
- unemployement increases
- hinders implementation of development plans
- Highlight five importance of entrepreneurship to the economy of a country. (10mks)
- Explain five negative effects of inflation to a country’s economic development.(10mks)
-
- Explain five factors that can lead to unfavourable balance of payment. (10mks)
- Explain five factors to be considered when choosing a method of product promotion (10mks)
-
- Describe five procedure to be followed when taking an insurance policy. (10mks)
- filing a proposal form
the person intending to take policy applies by filing a form - determinatio of premium
the insurance company, studies information provided in proposal form to determine premiums to be paid - payment of first premium
issuance of cover note/binder
evidence that an agreement has been entered into by the two parties - issuance of insurance policy / certificate
the insurance of issues policy /certificate which details the agreement between the 2 parties
- filing a proposal form
- Explain five limitations of containerization in transport sector. (10mks)
- requires specialised equipment for handling
this is lacking or is expensive to buy/maintain - requires specialized staff
this is lacking or is expensive to buy/maintain - volume of business may not be large enough to warrant investment / uneconomical
- initial capital required is high - not avilable
- method requires redesigning of ports or construction - expensive
- resistance by employees/COTU and other intended parties as it causes unemployment
- requires use of technology which is lacking
- requires specialised equipment for handling
- Describe five procedure to be followed when taking an insurance policy. (10mks)
-
- Highlight five benefits that a country will enjoy as a result of indirect production(10mks)
- use available resources - idle / wasted
- creation of employment for those engaged in trading activities
- expanded/ wide market for goods
- variety of goods/services - gives people a wide choice / to satisfy different consumer needs
- increased incomes
- imcreased business opportunities
- increased production fo goods and services - more goods available to country citizens
- increased specialisation - increased quality/output
- improved tech due to exchange of ideas
- enhances peace/understanding due to interaction
- disposal/sale of suplus goods - minimising wastage/loss
- receive goods/services they dont rpoduce by buying from others
- improved infrastructure (eg roads) leading to easy movement
- The following trial balance was extracted from the books of Mugoya Traders as at 30th June, 2014
Mugoya Traders
Trial balance
As at 30th June 2014
Details
Dr (shs)
Cr (shs)
Premises
1,500,000
Debtors and creditors
20,000
30,000
Cash at bank
90,000
Cash in hand
10,000
Purchases and sales
140,000
320,000
Stock of good on 1st July 2013
45,000
Discounts
6,000
2,000
Salaries and wages
50,000
Commissions
8,000
Power and lighting
12,000
Returns
15,000
19,000
Carriage outwards
2,300
Carriage inwards
5,400
Capital
1,543,700
Furniture
27,000
1,922,700
1,922,700
Stock of goods on 30th June, 2014 was worth sh22, 000.
Required: prepare trading, profit and loss account for the period ended 30th June, 2014. (10mks)
Mugoya Traders
Trading profit and loss account
For the year ended 30th June 2014
sh sh sh opening stock 45 000 sales 320 000 add purchases 140 000 less sales returns (15 000) less purchase returns (19 000) 305 000 add carriage 5 400 164 400 C.G.A.F.S 209 400 less closing stock (22 000) C.G.S 187 400 gross profit 117 600 305 000 305 000 discounts 6 000 gross profit 117 600 salaries 50 000 discounts 2 000 power/lighting 12 000 commisions 8 000 carriage outwar 2 300 net profit 57 300 127 600 127 600
20 × ½
- Highlight five benefits that a country will enjoy as a result of indirect production(10mks)
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