List four types of utility.                                                                                                                  (4 marks)

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………….

2. Identify four items that is included in a business plan.                                                               (4 marks)

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………….

3. Highlight four features of oligopoly market structure.                                                                 (4 marks)

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………….

4. State four advantages of audio­visual communication                                                                 (4 marks)

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………….

5. The following are description of errors. Identify the type of error that matches the description given in the table below.                                                                                                                           (4 marks)

DescriptionType of error
Occurs where a transaction is not recorded at all in the books of accounts. 
Occurs where errors is both the debit and credit balance are of equal amounts. 
Occurs when entries are made in the wrong class of accounts. 
Occurs where both the debit and credit entries are made using similar but erroneous figures. 

6. Highlight four assumptions of a two sector economy                                                                  (4 marks)

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………….

7. List four polices under marine insurance.                                                                                    (4 marks) 

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………….

8. Give the right document that relates to the following statements.                                                           (4 marks)

StatementDocument
Corrects an undercharge 
Shows total amount expected from a number of transactions in a given period. 
It’s a booklet containing brief description of goods. 
Demands payment for goods sold on credit. 

9. Highlight four measures that have been enacted by the government to protect consumers.        (4 marks) ……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………….

10. Mention four characteristics of assets in an organization.                                                         (4 marks)

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………….

11. State four types of demands described in each of the following:                                               (4 marks)

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DescriptionType of Demand
A farmer needs to produce milk but must first of all breed cows. 
A farmer producing cotton for him to get clothes, pillows and blankets 
Buying a car leading to purchase of petrol 
Consumer purchasing tea instead of coffee to satisfy his needs 

12. Highlight four ways through which a country can increase the volume of exports                   (4 marks)                                                                                            

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………….

13. State ways in which commercial banks facilitates payment on behalf of their customers.        (4 marks)

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………….

14. The following transactions took place during the month of March 2021 in the business of Ali Traders

2021

March 5   Hodari traders returned goods amounting to sh. 1500. They were issued credit note No. 204.

15th    Otano returned part of the goods sold to him amounting to 1000. He was issued with credit  note No. 205

20th    Milo a customer returned wrong sized goods which had been sold to her earlier on, worth sh. 500. She was issued with the credit note No. 206

Required; prepare a relevant journal.                                                                                 (4 marks)

15. Outline four benefits that a country would get by encouraging businessmen to locate new industries in rural areas.                                                                                                                                     (4 marks)

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………….

16. Outline four elements that comprise the internal environment of a business.                           (4 marks)

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………….

17. Name four documents required for the registration of a limited liability company.                  (4 marks)

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………….

18. Outline four structural changes that may take place when a country is experiencing economic development.                                                                                                                                               (4 marks)

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……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………….

19. State Four differences between liners and tramps                                                                      (4 marks)

                    LINERS                 TRAMPS
  
  
  
  

20. Mention four expenses incurred by intermediaries in the channel of distribution.                    (4 marks)

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………….

21. Highlight four requirements that are needed for a smooth functioning of a warehouse.                       (4 marks)

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………….

22. State four measures which are used to control inflation under monetary policy.                      (4 marks)

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………….23. Outline four merits of replacing manual systems with automated ones in carrying out office activities.                                                                                                                                                   (4 marks)

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………….

24. State four causes of seasonal unemployment in Kenya.                                                            (4 marks)

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………….

25. State the effects of the following transactions in the balance sheet by writing INCREASE or DECREASE or NO EFFECT in each case.                                                                                   (4 marks)

Transactions                                                                                      Effect

a) Bought machinery on credit                                             _________________________

b) Withdraw cash from the businesses for personal use         __________________________

c) Purchased stock in cash                                                      __________________________

Paid outstanding loan by cheque                                            __________________________

Answers to Business Studies KCSE Prediction Questions

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