Business Studies Questions and Answers 2 - Form 4 Mid-term Exams Term 1 2022

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QUESTIONS

INSTRUCTIONS TO CANDIDATES:

  • Write your name and Adm Number in the spaces provided.
  • Answer all the questions
  • Candidates should check the question paper to ascertain that no questions are missing.

 

  1. The following transactions relate to the books of Amina traders as at 31st December 2015.

    Gross profit ............................................................................................. 20,000
    Commission allowed .............................................................................. 200
    Carriage on sales .................................................................................... 4,000
    Discount received................................................................................... 8,000
    Salaries.................................................................................................. 6,000
    Rent........................................................................................................ 2,000
    Discount revived .................................................................................... 400
    Commission received............................................................................. 1,500
    Interest on bank loan .............................................................................. 500
    Prepare Amina’s profit and loss account for the period ended 31st December, 2015. (5 marks)

  2. The National Transport Safety Authority (NTSA) is a department within the transport sector in Kenya. Highlight four benefits Kenyans enjoy due to the establishment of NTSA (4 marks)
  3. Outline four reasons why a firm would prefer to locate near the market of its products (4 marks)
  4. List three withdrawals in the circular flow of income (3 marks)
  5. The following transactions relate to the books of kilimo holdings. Record them in the relevant ledger accounts. (4 marks)
    1. 1st January 2015, took a loan with ICDC of kshs. 50,000 receiving by cheque.
    2. 5th January 2015, kelunyo, a debtor paid his account of kshs. 40,000 in cash.
    3. 10th January 2015, took money from bank, kshs. 50,000 for office use
    4. 12th January 2015, bought furniture kshs. 35,500 in cash
  6. Unemployment solving has been an agenda to most developing economies. Identify the type of unemployment being solved below. (4 marks)
    1. Government initiating irrigation projects to ensure continuous production of food
    2. Retraining teachers to embrace use of technology in teaching and learning
    3. Government and private sectors inventing job advertisement sites for easy access by job seekers
    4. Parliament passing legislation that accommodate the disabled people to acquire jobs
  7. State four essentials of effective communication (4 marks)
  8. Highlight four reasons why people engage in Business activities.(4marks)
  9. Outline four characteristics of a good filing system (4mks)
  10. Highlight four methods that Government uses to protect consumers. (4mks)
  11. 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

    Additional information
    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

  1. AMINA TRADERS
    PROFIT AND LOSS A/C
    FOR THE PERIOD ENDED 31ST DEC 2015

    Expenses

    Commission allowed               200

    Carriage on sales                   4,000

    Discount allowed                    8,000

    Salaries                                  6,000

    Rent                                       2,000

    Interest on Bank loan              500

    Net profit c/d                          8,400

                                                 21,900
                                         ----------------

    Revenue

    Gross profit                                 20,000

    Discount received                       400

    Commission received                1,500

    .                                                  21,900

                                                     =========

    Net profit b/d                             8,400

  2. Benefits of NTSA to the Kenyan people. (4 marks)
    • Unroadworthy vehicles have been removed hence reducing road accidents
    • Use of speed limiter has reduced road accidents
    • Carrying capacity has been limited hence reducing overloading and uncomfortability
    • PSV are operated by people with certificates of good conduct comfortable of customers/there is order
    • Drivers and conductors have uniforms that help in identifying them
    • Yellow lines help identify PSV by their users
    • Use of alcoblows has helped reduce the effect of drunk driving hence reducing accidents.
    • Requirement that all PSVs be members of a SACCO for order, discipline and proper management of PSVs. Passengers can take their complains to the Sacco.
  3. Reasons why a firm would locate near the market for products (4 marks)
    • Competing tool
    • If the market is concentrated in one place
    • If the product is heavy to avoid the cost of transportation
    • The product is perishable
    • It may be due to Government policy
  4. Withrawals in the circular flow of income (3 marks)
    • Taxation
    • Saving
    • Imports
  5.                             
    DR  CR 
    Bank Account
    1/1.2015 ICDC                      500,000 10/1/2015 Cash                    50,000 
       
      ICDC A/C
      1/1/2015     Bank                   500,000
       
      Kelunyo  account
      5/1/2015   Cash    40,000
       
    Cash      A/C

    5/1/2015 Kelunyo 40,000

    12/1/2015 Furniture  35,500
    10/1/2015 Bank 50,000  
       
    Furniture account

    12/1/2015 Cash 35,500

     
  6.                                         
    1. Kenya government initiating irrigation projects to ensure continuous food production
      • seasonal unemployment
    2. Retraining teachers to embrace the use of technology in teaching and learning
      • structural unemployment
    3. Government and private sectors inventing job advertisement sites for easy access by job seeker;
      • frictional/involuntary unemployment
    4. Parliament passing legislation that accommodate the disable people to acquire jobs;
      • residual unemployment
  7. State four essentials of effective communication. (4marks)
    1. Medium used should be appropriate
    2. Language used must be simple to understand
    3. Information overload should be avoided
    4. Both the sender and the receiver must have positive attitude while communicating.
    5. It must be free from distortion
    6. Environment should be free from noise
    7. Message should get to the intended recipient in good time.
    8. The sender should have adequate knowledge of information being conveyed.
  8. Highlight four reasons why people engage in Business activities. (4mks)
    1. To create employment opportunities
    2. To make use of available local resources
    3. To be their own bosses
    4. To increase their present income
    5. To utilize their free time
    6. To commercialize their skills and talents
  9. Outline four characteristics of a good filing system (4mks)
    1. Simplicity
    2. Compactness i.e occupy little office space
    3. Suitability
    4. Should be economical
    5. Safety
    6. Accessibility
  10. Highlight four methods that Government uses to protect consumers. (4mks)
    1. Setting up standards
    2. By licensing
    3. Weights and measures act
    4. Food and drug act
    5. Trade description act / sale of good act
    6. Public health act
    7. Rent and tribunal act
  11.                          
    11 auygdygauyda

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