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Business Studies Paper 2

Answer any five question

(a). Explain four services offered by wholesalers to producers.

(b). Prepare a duly balanced three column cash book from the following information.

Jan . 1 Balance b/d cash Kshs.4,000 bank Kshs.27,000

Jan 4. Settled Olweny creditors account of Kshs.8,000 by cheque having deducted 6 % cash discount.

Jan. 8 Received Kshs.6,000 cash from Mutoma traders.

Jan. 16 Deposited Ksh.4,500 to the bank.

Jan 24 Withdrew Ksh.9,200 from the bank for private use.

Jan 29 Received Ksh.19,950 from Kawawa by cheque after allowing 5% discount.

Jan 31 Banked all the cash leaving only shs.1500 in the office.

20 marks


(a). Explain four statutory measures the government would take to control the impact of inflation.
(b). Using a well labeled diagram, explain the effects of fixing price above and below the equilibrium price.

20 marks


(a). Explain five differences between a public corporation and Public Limited Company.

(b). Explain five features of a perfectly competition market structure.

20 marks


(a). A farmer in Kakamega has to transport his maize to Mombasa. He could either use road or railway transport. Explain to him five merits of using road instead of railway.
(b). The following information relates to Nakuru traders for the month of March 2008. You are required to enter the transactions in the appropriate journals. Credit sales to:

20 marks


(a). Explain five sources of finance available to Kenya government.

(b). Explain five factors that hinder geographical mobility of labour.

20 marks


(a). Explain six emerging trends related to product promotion.

(b). The following information relates to Njoro Traders for the year ended 31st April 2005.

20 marks

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