QUESTIONS
- State four characteristics of services.(4 marks)
- In the spaces provided below, indicate the level of production that relates to each of the following activities:(4 marks)
Activity Level of production (a)Selling goods in the market
(b) Fishing from a river
(c) Constructing a road
(d) Making shoes - List four types of business activities. (4 marks)
- Highlight four benefits that accrue to an entrepreneur who prepares a business plan. (4 marks)
- Give four differences between ordinary shares and preference shares. (4 marks)
- State four reasons why the government issues licenses to business people. (4 marks)
- Outline four factors that would influence the amount of money held by an individual for transaction purpose. (4 marks)
- Outline four factors that may lead to the success of business. (4 marks)
- Give four circumstances when pipeline would be more preferred as a means of transport. (4 marks)
- Name four source documents which are used to provide information used to make entries in the books of accounts. (4 marks)
- Complete the table below for business W, X, Y and Z.
BUSINESS ASSETS LIABILITIES CAPITAL W A 250,000 700,000 X 85,000 30,000 B Y 420,000 C 120,000 Z 600,000 175,000 D - State four benefits a trader receives from warehousing. (4 marks)
- Highlight four emerging issues in communication. (4 marks)
- State four factors that influence the fertility rate of a population. (4 marks)
- Outline four expenditure items that are included in the measurement of national income under the expenditure approach. (4 marks)
- The following information relates to Kamara Traders on 31st January 2018:
Opening stock - 40,000
Purchases - 480,000
Gross profit - 100,000
Mark-up - 25%
Calculate:- Closing stock. (2 marks)
- Rate of stock turnover for the year. (2 marks)
- Highlight four ways in which the demographic environment affects the performance of the business. (4 marks)
- State four factors to consider when making a choice of channel to use in distributing locally produced agricultural products. (4 marks)
- Outline four benefits received by a student who finished form four and had done business studies as a subject. (4 marks)
- Indicate which accounts to be debited and which accounts to be credited from the following transactions: (4 marks)
Transaction A/c Dr A/c Dr (a) Proprietor took cash Sh. 18,000 and paid rent (b) Brought in personal table and made it to be a business asset. (c) A debtor paid Sh 80,000 by cheque. (d) Transferred Sh 20,000 to a private bank account. - Mumias West Wholesalers insured their business worth Ksh. 2,850,000 for Ksh. 2,300,000 against fire. Eight months later, fire destroyed the business leading to a loss of Ksh. 1,248,000. Calculate what the insurance company compensated the business (4 marks)
- Give four trends and emerging issues in office management. (4 marks)
- Highlight four decisions made when deciding which goods and services to produce. (4 marks)
- Outline how the following utilities are fulfilled: (4 marks)
Utility How it is fulfilled (a) Place (b) Form (c) Time (d) Possession - State four circumstances when a high population growth rate may be desirable. (4 marks)
MARKING SCHEME
-
- They are intangible
- They are inseparable from those providing them
- Services are highly perishable
- Quality of services cannot be standardized.
- Price paid for services is for experience but not for ownership.
- They can’t be seen
-
- Tertiary level
- Primary level
- Secondary level
- Secondary level
-
- Extraction
- Processing
- Manufacturing
- Construction
- Distribution of goods
- Trade
- Provision of services
-
- He/ she is able to allocate/ distribute resources well
- He/ she is able to avoid mistakes
- He/ she is able to get finances easily from the financiers, e.g. banks.
- He/ she is able to compare and assess business growth from time to time
- It is a motivating factor as a result of achieving goals and objectives.
Ordinary shares Preference shares (a)Have voting rights
(b)Receive dividends last
(c)Do not have a fixed rate of dividends
(d)Have a claim to business assets upon dissolution
(e)Non cumulativeNo voting rights
Receive dividends first
Have fixed rate of dividends
Have no claim to business assets upon dissolution
Cumulative or non-cumulative-
- To collect/ raise revenue/ income
- Regulate unfair competition
- Control harmful products being sold to the consumers
- Regulate illegal businesses
- Control goods leaving and entering the country
- Ensure those engaged in business meet the professional requirements
- Ensure that traders engage only in trade activities that they are licensed for.
-
- Individual’s level of income
- Individual’s spending habits
- Prices of commodities
- Interval between receipts of income
- Availability of credit
-
- Presence of good infrastructure /well developed
- Proper allocation of resources
- Relevant entrepreneurial skills
- Use of modern technology
- Availability of market
- Availability of capital
- Good customer relations
- Favourable government policies.
- Proper time management.
-
- When high volume of fuel is needed
- When traffic jam needs to be avoided
- When less labour is needed
- Where there is need to maintain roads
- Where there is need to minimize/ avoid road accidents
- Incase supply is needed continuously
- Where there is need to control environmental pollution.
-
- Invoice;
- Receipt;
- Credit note;
- Debit note;
- Payment voucher.
BUSINESS ASSETS LIABILITIES CAPITAL W 950,000 250,000 700,000 X 85,000 30,000 55,000 Y 420,000 300,000 120,000 Z 600,000 175,000 425,000 -
- Goods are safe/ secure from being stolen
- Able to look for transfers/ customers
- Can prepare the goods for sale while still in warehouse
- Can receive transport services
- Can receive credit services
- Customers can view the goods while in the warehouse, hence creating demand
- Can sell goods while in the warehouse hence transfer cost of paying the expenses to the customer, e.g. customs duty.
-
- Development of paperless offices
- Transformation of the language of Sheng among the youth
- Wide use of mobile phones
- E-mail replacing normal mails
- Internet use.
-
- Economic status of population
- Education levels
- Health levels
- Society’s level of morality/ social customs
- Government policy on population
- Political attitude towards family size
- Natural calamities
- Technological progress
- Age and sex structure of population
- Marriage role among those in productive age brackets.
-
- Consumer expenditure
- Government expenditure
- Imports expenditure (international trade)
- Expenditure by firms on capital goods or investments.
-
- Markup = GP/ Cogs
25/100 = 100,000/ Cogs
Cogs = (10,0000 * 100) / 25
Cogs = 400,000
Cogs = OS + P – CS
400,000 = 40,000 + 480,000 – CS
CS = 520,000 – 400,000
=120,000
6 ticks * 1/3 = 2 mks - ROSTO = COGS/ A.S.
A.S. = (OS + CS) / 2
= (40,000 + 120,000) / 2
= 80,000
ROSTO = 400,000 / 80,000
=5 times
4 ticks @ ½ = 2 mks
- Markup = GP/ Cogs
-
- High population creates wider market
- Large population may cause security/ moral threat to business
- Population offers labour for business
- Brings innovation and invention for better technological advancements.
- May provide raw materials.
-
- Consumers/ market
- Nature of products
- Firm’s characteristics
- Level of competition/ competitors
- Marketing risks
- Government policy
- Middlemen cost
-
- Is a career subject;
- Can be able to start and run a business;
- Is able to appreciate the role of government in business;
- Is able to appreciate the role of business in society;
- Will have self-discipline;
- Will utilize skills acquired for self-development.
Transaction A/c Dr A/c Dr (a) Proprietor took cash Sh. 18,000 and paid rent Rent Cash (b) Brought in personal table and made it to be a business asset. Furniture/ Table Capital/ Investment (c) A debtor paid Sh 80,000 by cheque. Bank Debtor (d) Transferred Sh 20,000 to a private bank account. Drawings Bank - Compensation = (Value of policy * Loss) / Value of property
= (2,300,000 * 1,248,000) / 2,850,000
= 1,007,158 -
- More open and landscape office layouts
- Introduction of public relations departments
- Improved security, e.g. use of CCTV cameras
- Extensive use of computers and computerized systems
- Use of modern office furniture and equipment
- Health, Safety and Exercise and breakout areas
- Use of identification name tags.
-
- Demand/ market scope for the goods and services to produce
- The cost of production
- Government policies affecting production
- Availability of resources
- Availability of technology
- Skills requirement
- Financial viability
- Return on investment.
Utility How it is fulfilled (a) Place Transport (b) Form Manufacturing/ Production/Processing (c) Time Warehousing/ Storage (d) Possession Selling/ Trade -
- When large market is needed to be offered by the high population
- When large labour is needed
- When a pool of talents and gifts is needed
- When there is need of utilizing resources to the maximum
- Where there is need to improve technology
Join our whatsapp group for latest updates
Tap Here to Download for 50/-
Get on WhatsApp for 50/-
Download Business Paper 1 Questions and Answers - Mumias West Pre Mocks 2022.
Tap Here to Download for 50/-
Get on WhatsApp for 50/-
Why download?
- ✔ To read offline at any time.
- ✔ To Print at your convenience
- ✔ Share Easily with Friends / Students