Business Studies Paper 2 Questions and Answers - Maranda Mocks 2021/2022 Exams

 BUSINESS STUDIES
Paper 2 December 

INSTRUCTION TO CANDIDATES

• This paper consists of six questions.
• Answer any five questions of your choice.
• Candidates should answer the questions in English.

Questions

1.            
   1. Explain five factors to be considered when setting up an office layout for a business organization. (10 marks)
   2. Explain five internal economies of scale that may be experienced by the firm. (10 marks)
2.    
   1. Explain five factors that county government Siaya may consider before incurring any expenditure. (10 marks)
   2. Explain five business considerations an entrepreneur has to evaluate before accepting a chance for investment. (10 marks)
3.         
   1. Explain five ways in the economic environment may affect business operation positively. (10 marks)
   2. The following trial balance was prepared form the books of Obechi Retailers for the year ended 31st December, 2020.
      

      Obechi Retailers Trial Balance As at 31st December, 2020
      Details	Debit (Shs.)	Credit (Shs.)
      Land and building	500 000
      Capital		940 000
      Plant and machinery	200 000
      Motor vehicles	300 000
      15 year loan KCB		200 000
      Stock	100 000
      Debtors and Creditors	80 000	60 000
      Accrued Salary		20 000
      Cash at bank	200 000
      Drawings	100 000
      2 year loan Faulu Bank		260 000
      TOTALS	1 480 000	1 480 000

      Required
      Prepare
      1. Balance sheet as at 31st December. 2020. (7 marks)
      2. Determine
         1. Working Capital. (1 mark)
         2. Capital employed (1 mark)
         3. Borrowed capital (1mark)
4.         
   1. Explain five Errors that a trial balance may not show. (10 marks)
   2. Explain five benefits that a country derives from transporting oil through pipeline. (10 marks)
5.      
   1. Outline five Circumstances under which a company may prefer to use informative advertising (10 marks)
   2. On January 1st 2021, Mutiri Traders had cash in hand Shs.74,000 and a credit Bank balance of Shs.500,000.
      During the month the following Transactions took place
      2021
      January 2   Cash Sales Sh.100, 000
      January 3   Paid salaries Shs.203,000 by cheque
      January 6   Received a cheque of Shs.153, 600 from Mwamba after allowing her a cash discount of 40%
      January 16 Settled Romeo’s Account of Shs.80, 000 in cash deducting Shs.1,600 cash discount.
      January 18 Received a cheque for Shs.300,000 in respect of sales January 22 Withdrew Shs.60,000 from the bank for office use.
      January 25 Took Shs.10,000 cash for his son/s birthday to be celebrated at home. January 28 Received Shs.33,000 cash from Matoke settlement of his account less Shs.1,320 cash discount.
      January 30 Deposited all the money into the bank except Shs.50,000.
      
      Required:
      Prepare a 3 column cashbook duly balanced on 31st January 2021. (10 marks)
6.        
   1. Outline five differences between the Central Bank and Commercial Banks. (10 marks)
   2. Explain five measures used to solve unemployment problems. (10 marks)