565/1 · BUSINESS STUDIES · Paper 1 · Nov. 2023 · 2 hours
Instructions: Answer all the questions in the spaces provided. Non-programmable silent electronic calculators may be used.
1. Highlight four benefits of continual road construction in Kenya. (4 marks)
2. List four office equipment used in the finance department. (4 marks)
3. State four factors that may lead to increased demand for a product. (4 marks)
4. State four features that enable a warehouse to function effectively. (4 marks)
5. Outline four circumstances under which a company would use personal selling to market its product. (4 marks)
6. Highlight four advantages of using M-banking. (4 marks)
7. The following information was obtained from Mogadishu Traders for the year ended 31st December 2022.
| Details | KShs |
|---|---|
| Opening stock | 40,000 |
| Purchases | 400,000 |
| Gross profit | 100,000 |
Goods were sold at a mark-up of 25%. Calculate: (a) sales for the year; (2 marks) (b) rate of stock turnover. (2 marks)
8. Outline four circumstances under which a country may control imports. (4 marks)
9. Highlight four limitations of radio calls as a means of communication. (4 marks)
10. State four circumstances that may lead to the dissolution of a company. (4 marks)
11. Highlight three differences between movement along the demand curve and a shift of the demand curve. (3 marks)
12. The following information was obtained from the books of John Enterprises on 31/12/2022.
| Item | KShs |
|---|---|
| Purchases | 110,000 |
| Stock 1/1/2022 | 50,000 |
| Purchases returns | 8,000 |
| Stock 31/12/2022 | 32,000 |
| Sales returns | 5,000 |
Mark-up 25%. Prepare John Enterprises' Trading Account for the period ending 31st December 2022. (5 marks)
13. State four characteristics of a monopoly. (4 marks)
14. Explain the meaning of the following concepts as used in business: (a) scarcity; (b) choice; (c) opportunity cost. (3 marks)
15. Highlight four reasons that may lead to privatisation of government-owned firms. (4 marks)
16. Name the business document to which each of the following statements relates: (5 marks)
| Statement | Document | |
|---|---|---|
| (a) | It shows details of transactions between seller and buyer. | |
| (b) | It is used to correct an undercharge in an invoice. | |
| (c) | It informs the buyer when the goods were dispatched. | |
| (d) | A request by the seller for payment in advance. | |
| (e) | It is issued by the seller to a buyer for cash payments. |
17. Outline how each of the following types of utility is created in production: (a) place utility; (b) form utility; (c) possession utility; (d) time utility. (4 marks)
18. State four factors that may influence the level of national income. (4 marks)
19. Highlight four demerits of external borrowing. (4 marks)
20. State three uses of a letter of inquiry. (3 marks)
21. Highlight four reasons that may make a company prepare a business plan. (4 marks)
22. Outline four methods used by the government to protect consumers from exploitation. (4 marks)
23. The following transactions relate to Kamili Traders for the month of December 2022:
| Date | Transaction |
|---|---|
| 2nd | Cash sales KShs 30,000 |
| 8th | Banked KShs 15,000 |
| 10th | Withdrew KShs 10,000 from the bank for office use |
| 13th | Paid wages in cash KShs 6,000 |
Prepare a double-column cash book. (5 marks)
24. State four factors to consider when choosing the location of a business. (4 marks)
25. Outline four benefits that a country may derive from delocalisation of firms. (4 marks)