bece model questions vol1 2021 business_studies | Practical

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Question 1 View Details
A group of students are conducting a simple market survey to understand the basic concepts of business. Using the information gathered, answer the following tasks.
Question Parts
(a)
Provide a concise definition of “business” (no more than two sentences) and give one example of a private business that operates in Nigeria.
(b)
List three core functions of a business and briefly explain each. Then, using the example you gave in (a), illustrate how the three functions are linked in the operation of that business.
(c)
Identify two advantages and two disadvantages of operating a business as a sole proprietorship.
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Question 2 View Details
A small retail shop needs to replenish its office supplies. The shop manager prepares a purchase order based on the price schedule supplied by the supplier. Price schedule: - Ballpoint pens: ₦120 each - Notebooks: ₦350 each - Ink cartridge: ₦2,500 each Discount policy: - 5 % discount on the total invoice before tax if the invoice value exceeds ₦20,000. - 10 % discount if the invoice value exceeds ₦35,000. VAT of 7.5 % is charged on the amount after any discount. The manager estimates the shop will need 150 pens, 80 notebooks and 4 ink cartridges. Answer the following questions.
Question Parts
(a)
Calculate the total amount payable before any discount is applied.
(b)
Determine the discount rate that applies and compute the amount after discount.
(c)
Compute the VAT payable on the discounted amount and state the final amount the shop must pay.
(d)
The manager is considering ordering an additional 50 pens to reach the next discount threshold. Re‑calculate the final amount if the extra pens are ordered and advise whether the extra pens should be ordered.
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Question 3 View Details
A small retail shop sells 15 units of a product called “EcoBottle” to a customer. Each EcoBottle has a unit price of ₦2,500. The shop offers a 10 % discount on the total purchase if the quantity purchased is 10 units or more. After the discount, a value‑added tax (VAT) of 7.5 % is added to the net amount. The customer pays cash.
Question Parts
(a)
Prepare a sales invoice for the transaction described above, showing all required details (shop name, address, date, invoice number, buyer details, description, quantity, unit price, amount, discount, VAT, total payable).
(b)
Calculate the following:
() Discount amount.
() VAT amount.
() Total amount payable by the customer.
(c)
Identify two possible sources of error that could occur when preparing such an invoice and suggest one precaution for each to avoid the error.
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Question 4 View Details
A manufacturing company has received a shipment of 200 defective widgets from its supplier, XYZ Ltd. The company needs to inform the supplier and request a replacement of the defective items.
Question Parts
(a)
Write a formal business letter to XYZ Ltd requesting replacement of the defective widgets. Include appropriate headings, salutations, body paragraphs, and closing.
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Question 5 View Details
A small trading business keeps a cash book and also receives a monthly bank statement. The following information relates to the period ended 30 June 2024: - Cash book balance (debit) on 30 June 2024: ₦250,000 - Bank statement balance (debit) on 30 June 2024: ₦210,000 - Cheques issued but not yet presented (as per cash book): * Cheque No. 101 for ₦30,000 dated 28 June * Cheque No. 102 for ₦15,000 dated 30 June - Deposits recorded in the cash book but not yet reflected in the bank statement: a cash deposit of ₦20,000 received on 30 June. - Bank charges shown on the statement (not recorded in the cash book): ₦2,500. - Interest earned shown on the statement (not recorded in the cash book): ₦1,200. - Bank error: the bank mistakenly credited ₦5,000 to another customer's account; the amount should be deducted from the business's balance. - Cash receipt of ₦8,700 recorded by the bank but not yet entered in the cash book. Based on the above information answer the following questions:
Question Parts
(a)
Prepare a bank reconciliation statement showing the adjusted cash book balance.
(b)
Identify any two possible reasons, other than those already given, for a difference between the cash book balance and the bank statement balance, and suggest how each should be corrected in the records.
(c)
The bank pays interest at 4% per annum simple interest, credited quarterly. Calculate the effective annual interest rate earned on the adjusted cash book balance and show the calculation.
(d)
The business aims to keep a minimum cash book balance of ₦50,000. Based on your reconciliation, advise whether this requirement is met and, if it were not, recommend one short‑term financing option, stating its key features.
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