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Business Studies
PRE-TRIAL 2018
Time 2 HRS

ALLIANCE HIGH SCHOOL
PRE-TRIAL 2018
Business Studies Paper 1

1. State the type of document described below in relation to home trade. (4 mks)
   1. Sent by the seller before goods are delivered showing how the invoice would look like
   2. Shows in a summary the transactions between the buyer and the seller
   3. Acknowledges a debt but does not show specific date of payment
   4. Pre – printed form that request the seller to supply the buyer with goods.
2. Highlight 4 fiscal policies that can be used to control inflation.
3. You have been provided with the following information of Sibuor Traders.
   
   

   5 years loan	500,000
   2 years loan	290,000
   Stock	68,000
   Cash	100,000
   Overdraft	42,600
   Debtors	79,000
   Creditors	49,400
   Building	355,000
   Motor Van	587,500
   Land	700,000

   
   Calculate
   1. Liquid ratio (1 mk)
   2. Current Ratio (1 mk)
   3. Working capital (1 mk)
   4. Capital employed (1 mk)
4. In relation to product promotion describe the meaning of the following terms ( 4 mks)
   1. Loss leader
   2. Hoardings
   3. Institutional advertisement
   4. Psychological selling
5. 1. Given the following demand and supply schedule on the axis draw the demand and supply curve, show all the equilibriums (2¹/₂ mks)
      
      

      Price	Qty demand	Qty supplied
      1	100	10
      2	80	20
      3	60	40
      4	40	60
      5	20	80
      6	10	100

   2. Indicate the new equilibriums if there is a decrease in total supply ( 1 ¹/₂ mks)
6. Outline 4 types of unemployment in Kenya today. (4 mks)
7. From the data of Kanyi Traders given below prepare a profit and loss account on 31/12/2013 ( 4 mks)
   
   

   Gross loss	25,400
   Commission Received	75,100
   Discount allowed	15,300
   Rent Paid	22,400
   Rent Received	17,800
   Insurance	2,000
   Power	4,000
   Commission Received	10,800
   Rates	18,000

8. Highlight 4 differences between monopoly and monopolistic competition (4 mks)
9. State 4 features of indirect production. (4 mks)
10. Outline 4 disadvantages of delocalization of firms. (4 mks)
11. Highlight 4 ways that can be used to increase a country's exports in order to correct unfavouble balance of payment. (4 mks)
12. In evaluating a business opportunity there are certain personal consideration one has to take into account, highlight four (4 mks)
13. Record the following transaction in the appropriate book of original entry No posting is required (4 mks)
    March 1" Sales of goods on credit to Mark 7,800/- Lucy 5000/-
    March 2" Sales of goods on credit to Murimi 2000/-, George 1,400/-
    March 3 Sales of goods on credit to Tom 1,100/- Eugene 8,000/-
14. State 4 factors that determine the holding of money for precautionary motive. ( 4 mks)
15. Briefly explain the meaning of the following terms in relation to public finance ( 4 mks)
    1. Escheats
    2. Specific tax.
    3. Reproductive debt
    4. Impact of tax
16. Outline 4 factors that a school should take into consideration before deciding on a method оf rерrоgrарhу tо use. (4 mks)
17. State four other names given to books of original entry. (4 mks)
18. Give 4 reasons why Akinyl should run a sole proprietorship business instead of joining hands with others to form a partnership (4 mks)
19. Outline 4 factors that may make an insurer to re-insure. (4 mks)
20. Describe 4 features of liner ships. (4 mks)
21. The initials below indicate equilibrium national income.
    S+T+M - 1+ X +G
    
    Write the mean of the following (4 mks)
    1. X
    2. M
    3. S
    4. I
22. State 4 reasons why choice should be made in satisfying human wants. (4 mks)
23. Distinguish between the following (4 mks)
    1. General merchandise wholesalers and general line wholesalers.
    2. Del credare agents and import bookers
    3. Diagonal communication and vertical communication
    4. Speed post mail and Express mail
24. Outline 4 characteristics of bonded warehouse. (4 mks)
25. Given the following items of Duka Bora Shop, prepare a trial balance on 31/12/2017 (4 mks)
    
    

    Stock on 1st Jan 2017	43,000
    Stock on 31/12/2017	39,600
    Capital	?
    Land and building	500,000
    Sales	75,000
    Purchases	65,000
    Cash	100,000
    Overdraft	80,000
    Return Inwards	1,100
    Return outwards	2,000
    Carriage	5,000
    Rent Paid	1,700
    Postage	600
    Discount received	4,900
    Loan	290,000
    Creditors	160,000
    Debtors	145,000

    
    NB ¹/₅ of carriage relate sales

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