Series 2 Examination 2007

CERTIFICATE IN BUSINESS CALCULATIONS

Level 2 Wednesday 11 April Subject Code: 2003

Time allowed: 2 hours 30 minutes

INSTRUCTIONS FOR CANDIDATES Answer all 8 questions. Write your answers in blue or black ink/ballpoint. You may use pencil only for graphs, charts, diagrams, etc. All answers must be correctly numbered but need not be in numerical order. Workings must be shown. You must show all calculations, where applicable, on the answer paper provided. You can use mathematical and statistical tables. Your work should be accurate and neat. You may use a calculator provided the calculator gives no printout, has no word display facilities, is silent and cordless. The provision of batteries and their condition is your responsibility.

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ASE 2003 2 07 1

QUESTION 1 Julia deposits 7,500 in a bank account that pays 3% compound interest per annum. (a) How much will be in the account at the end of five years? (3 marks) (b) Calculate the average interest per year. (3 marks) Julia also deposits 7,500 for five years in a bank account that pays 3.5% simple interest per annum. (c) Calculate the total interest received. (3 marks) Karl deposits 16,000 in a bank account that pays simple interest. After 3 years the total interest paid by the bank is 1,920. (d) What is the annual rate of simple interest? (4 marks) (Total 13 marks)

QUESTION 2 A retailers total sales in a year were 840,000. The cost of goods sold was 622,800. During the year the following overheads were paid: 70,500 5,440 24,850 7,210

Wages Heat, light, telephone Premises Office expenses

Calculate: (a) gross profit (2 marks) (b) total overheads (2 marks) (c) net profit (2 marks) (d) the net profit as a percentage of the total sales (2 marks) (e) the average sales per month (2 marks) At the end of the year the retailer issued shares in the business. He planned to raise 3,000,000 through the issue of 1.2 million shares. (f) Calculate the price per share. (3 marks) (Total 13 marks)

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QUESTION 3 Danuta and Faisal are shop assistants. Danuta receives a weekly wage of 203 plus commission of 0.07 in the pound on goods sold. During one week, Danuta sold goods worth 1,100. (a) Find Danutas gross earnings in that week. (3 marks) The following are deductions from Danutas gross earnings: Pension contribution 7.5% of gross earnings Income tax 35. (b) Calculate Danutas net earnings for the week. (3 marks) Faisals weekly wage is 227 and his commission on goods sold is 0.05 in the pound. During another week, Danuta sold the same value of goods as Faisal. Danuta and Faisal received the same gross earnings. (c) Calculate the value of goods sold by each person during that week. (5 marks) (Total 11 marks) QUESTION 4 An office manager of a business orders the following items: Quantity 15 boxes 4 cartons 100 12 packs Description ball pens erasers rulers pencils Unit cost 3.05 per box 2.32 per carton 0.12 each 9.95 per pack

(a) Calculate the total cost of the above items. (3 marks) Other items are added to the order and then the order is subject to a trade discount of 10%. After trade discount the total cost of the order is 288.90. (b) Calculate the total cost of the order before trade discount. (3 marks) A cash discount of 2% is deductible if the amount owed to the supplier is paid within 28 days. (c) Calculate the amount paid by the business for settlement within 28 days. (4 marks) The manager order packs of envelopes as follows: Quantity 50 packs 80 packs 10 packs Description white, window recycled, buff embossed Unit cost 1.70 per pack 1.60 per pack 4.04 per pack

Each pack contains 100 envelopes. (d) Calculate the average cost of one envelope. (6 marks) (Total 16 marks)

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OVER

QUESTION 5 Christos wants to buy a 15,500 car on hire purchase. Companies A and B offer the following terms: Company A: 1,500 deposit, plus 12 monthly payments of 1,350 each. Company B: 10% deposit, plus 16,650 paid in equal monthly instalments over one and a half years. Compare the deposits, the monthly payments, and the total payments and advise Christos on which company to choose. (Total 13 marks)

QUESTION 6 Ying from Britain decided to go on a tour of Asia. She converted pounds sterling into other currencies as follows: 350 into Malay Ringgits 300 into Japanese yen 350 into Singapore Dollars at at at RM6.5 to the 200 to the $2.85 to the

(a) Calculate how much she received in each currency. (4 marks) She returned to Britain with RM50.50, 710 and $1.60. She converted RM50 and 700 into pounds sterling at the same exchange rate as above. (b) Calculate how much in total Ying received in sterling. (4 marks) Ying kept the remaining Malay, Japanese and Singapore currency in coins as a reminder of her trip. (c) Giving your answer in pence to the nearest penny, calculate the value in sterling of the currency she kept as a reminder of her tour of Asia. (4 marks) (Total 12 marks)

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QUESTION 7 An insurance company charges the following annual premiums for property insurance: Buildings 1.75 per 1,000 insured Contents 3.50 per 1,000 insured

A property owner wishes to insure a building valued at 155,000 and contents valued at 28,000. (a) Calculate the total annual cost to the owner of insuring the buildings and contents. (4 marks) A service fee of 4.5% of the total annual cost is charged when payment is made by 12 equal monthly instalments (b) Calculate: (i) (ii) the service fee (2 marks) the amount of each monthly instalment (4 marks) (Total 10 marks)

QUESTION 8 Lindi and Stacey are partners in a business with capital invested in the ratio 1:2. (a) Lindi, the junior partner, invested capital of 25,000. How much is Staceys investment? (2 marks) With Staceys agreement, Lindi withdrew half of her capital. (b) Calculate the new ratio of their investments, in its lowest terms. (3 marks) Lindi and Stacey decide to withdraw 7,800 of their profits. They share this in proportion to their new capital investments. (c) Calculate Lindis share of these profits. (3 marks) (d) Calculate how much more Lindi would have received if she had not withdrawn part of her original investment? (4 marks) (Total 12 marks)

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