Kenya Certificate Of Secondary Education (KCSE 2008) Business Paper 2

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    1. Explain five features that differentiate a Public Limited Company from a partnership form of business. (10 marks)
    2. With the aid of a diagram, explain the behavior of average cost curve in the short run for a firm with fixed production capacity. (10 marks)

    1. Explain five challenges that may be experienced by a country whose population is made up of a large proportion of young people. (10 marks)
    2. On 1 September 2006, Igonji had Sh. 55,000 in hand and Sh. 25, 000 at bank. During the month, the following transactions took place:
      three column cashbook kcse 2008
      Prepare a three column cash book and balance it off. (10 marks)

    1. Explain five ways in which an effective management practices may contribute to the success of a business. (10 marks)
    2. Explain five reasons why an effective filing system is important in an office. (10 marks)

    1. Explain five circumstances that would influence a producer to use wholesalers in distributing farm produce. (10 mark)
    2. Memon Traders do not keep a complete set of accounting records. The following information relates to the year ended 31 December 2006.
      accounting records kcse 2008

      Additional information

      Included in credit sales are drawings of stock valued at Sh. 25, 000.
      For the year ended 31 December 2006, determine the following:
      1. Total sales
      2. Total purchases
      3. Commission receivable
      4. Insurance expense
      5. General expenses            (10 marks)

    1. Describe four measures that the Government may put in place to reduce the amount of money in circulation. (8 marks)
    2. Explain six circumstances under which the country may restrict international trade. (12 marks)

    1. Explain four circumstances in which a trader may offer after sales service to the buyer. (8 marks
    2. The following balances were extracted from books of Simba Traders for the year ended 31 December 2006.
      balances kcse 2008

      Additional information
      1. Motor vehicle is depreciated by Sh. 187 500 while furniture is also to be depreciated by Sh. 16 050 per year.
      2. Interest on loan is charged at 18% per year. This interest was still owing on 31 December 2006.
      3. Rent unpaid on 31 December 2006 was Sh 2400.
        1. A profit and loss account for the year ended 31 December 2006.
        2. Balance sheet as at 31 December 2006. (12 marks)
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