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    BST PP1 MS

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    BST PP1 MS

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    talaichebu
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    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    7 views5 pages

    BST PP1 MS

    Uploaded by

    talaichebu

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 5

    MANGU PREMOCK EXAMINATIONS

    SERIES 2
    BUSINESS STUDIES
    PAPER 1 MARKING SCHEME
    1. Reason/ circumstances under which a trader would allow credit to a customer when if
    he she wants to attract more customers
    - He /she wants to retain existing customers
    - He /she wants to clear old stock
    - The customer has been frequently buying
    - The customer is honest /credit worthy
    - There is adequate stock
    - The customers is able to repay
    2. - Error of principle
    - Errors of original entry
    - Compensating errors
    - Errors of omission
    - Errors of commission
    - Errors of complete reversal of entry max (4x1=4mks)
    3. - Workers loose craftsmanship
    - May lead to redundancy
    - May cause unemployment
    - Its expensive to train /have personnel
    - Process may stop in case of breakdown of machines
    - Mishanding of machines may result into looses /damages (max 4x1=4mks)
    4. - Labour
    - Land
    - Entrepreneurship
    (4x1=4mks
    - Capital
    5. Outline four ways in which warehousing promotes trade in Kenya. (4 marks)
    (i) Ensures steady supply of goods
    (ii) Ensures stability of prices due to steady supply
    (iii) Ensures continuity of production
    (iv) Encourages production in large quantities

    Visit: www.mwalimuresources.co.ke ***11*** Call/WhatsApp: 0735649658


    (v) Protects goods from theft (1×4=4 marks)
    (any other relevant answer) (max (4x1)=4mks
    6- Strikes
    - Withdrawal of firms
    - Presence of natural calamites
    - High taxation
    - Withdrawal of subsidies
    - increase in costs of production
    7- Persuasive /competitive
    - Product
    - Informative
    - Institutional (4x1=4mks)
    8A/C DR A/C CR
    Creditors’ capital
    Cash capital
    Drawing cash
    Purchases bank
    9- Resources are limited
    - Needs /wants are unlimited
    - Resources differ in taste/preference /fashion
    - Resources have different prices
    - There are government policies on goods
    (any other relevant answer) (max 4x1)=4mks
    10- Cost is high
    - Suitable only for large volume of goods
    - Not suitable for bulky good with awkward shapes
    - May cause unemployment i.e is capital intensive
    - Slow especially in sea transport
    - Require special handling facilities
    (any other relevant answer) (max (4x1)=4mks
    11.Government intervention eg price control
    Haggling /bargaining
    Tendering
    Auditing
    12- Shows assets of business
    - Shows what a business owes to others ie liabities
    - Shows source of finance for a business
    - Shows net worth of the business

    Visit: www.mwalimuresources.co.ke ***21*** Call/WhatsApp: 0735649658


    - Can be sued to borrow money
    - Used in decision making
    - Used by investors to know what to invest
    Any other relevant answer)
    13- Ensure quality goods to customers - Ensure right quantity /size are offered
    - Prevent false adverts directed at customers
    - Ensure standards are maintained
    - Prevent sale of harmful goods
    - Prevent /protect against breach of contracts
    - Ensure fair prices
    - Curb –hoarding
    Any other relevant answer max 4x1)=4mks
    14.private company public company
    -2-50 person - no set maximum
    -Does not advertie share –advertise sale of share -Can start
    business on receiving –must wait for certificate certificate of
    incorporation of trading
    -Managed by 1-2 directors -managed by a board of directors
    -Shares are not transferable –shares are transferable
    (4x1=4mks) any other relevant answer)
    15.- Get after sale services
    - Obtain goods at low prices
    - Get technical advice on use of goods
    - May enjoy genuine /quality products
    (any other relevant answer) (max 4x1=4mks)
    16- When there is an overcharge
    - When goods are returned
    - When empty containers are returned
    - When goods are not yet delivered yet invoiced /charged
    - Where one is charged high price
    - Where errors in calculation occur resulting in higher figures than the correct one
    Max 4x1=4mks (any other relevant answer)
    17- Start business
    - Manages business
    - Contributes capital
    - Enjoy profits
    - Bears risks / suffers losses
    - Pays for expenses
    18 - Local producer- wholesaler-retailer –consumer

    Visit: www.mwalimuresources.co.ke ***31*** Call/WhatsApp: 0735649658


    - Producer –marketing board –retailer- consumer
    - Producer –consumer
    - Producer –retailer –consumer
    (any other relevant answer )(4x1=4mks)

    19- Attract skilled man power


    - Easy access to loans
    - Increased employee welfare
    - Spread of risks/diversification
    - Low transport cost
    - Enjoy trade discounts (4x1=4 mks)
    20. -Hen –egg /cow –milk
    - Torch battery /pen and ink
    - Wood /timber /sisal
    - sukuma wiki & cabbages
    Any other relevant example (4x1=4mks)
    21. - Protect document from loss/damage
    - Assist in office tidiness /efficiency
    - Aid memory –ie reference
    - Ensure systematic storage hence easy retrieval
    - minimize space
    - Prevent document from unauthorized persons
    (any other relevant answer)(4x1=4mks)
    22. - Less labour mobility
    - Low labour supply
    - High dependency ratio
    - Less progress in society
    - Fall in demand for goods favoured by youths
    - Conservatism /status quo persist
    (Any other relevant response) (4x1-(4mks)
    23.- Asset increase cash at bank decrease
    - Asset stock decrease and asset debtor increase
    - Asset debtor decrease and asset cash increase
    - Asset (building ) increase and capital also increase (4x1=4mks)
    24. The following trial balance was incorrectly prepared
    - KALWAL TRADERS
    - TRIAL BALANCE

    Visit: www.mwalimuresources.co.ke ***41*** Call/WhatsApp: 0735649658


    - AS AT 31-12-2004.

    DR CR
    - CAPITAL 31000√
    - CASH IN HAND 11000√
    - CREDITORS 14000√
    - INSURANCE 12000√
    - DEBTORS 13000
    - DRAWINGS 15000√
    - BANK OVER DRAFT 6000√
    - BANK LOAN 18000
    - STOCK 18000

    - 96000 96000 -
    - ½ x 8 = 4 marks
    25
    Monopoly Monopolistic competition
    - One seller -many sellers
    - Seller set price -prices set by demand& supply
    - There barrier to entry -No barrier to entry
    - No perfect knowledge –there is perfect knowledge
    - No close substitutes -there is close substitutes
    (any other relevant answer (4x1=4mks

    Visit: www.mwalimuresources.co.ke ***51*** Call/WhatsApp: 0735649658

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