Bus142302_M23050A.

qxd

09/02/2005

11:41

Page 1

Surname

Centre
No.

Initial(s)

Signature
Candidate No.
Paper Reference(s)

4330/1F

Examiners use only

London Examinations IGCSE

Team Leaders use only

Business Studies
Paper 1F

Foundation Tier
Thursday 12 May 2005 Afternoon
Time: 1 hour 30 minutes

Materials required for examination

Nil

Question Leave
Number Blank

1
2
3

Items included with question papers

Nil

Instructions to Candidates
In the boxes above, write your centre number and candidate number, your surname, initial(s) and
signature.
The paper reference is shown at the top of this page. Check that you have the correct question paper.
Answer ALL the questions in the spaces provided in this question paper.
Show all the steps in any calculations.

Information for Candidates

There are 12 pages in this question paper. Any blank pages are indicated.
The total mark for this paper is 60. The marks for parts of questions are shown in round brackets:
e.g. (2).
You may use a calculator.

Advice to Candidates
Write your answers neatly and in good English.

Total
This publication may be reproduced only in accordance with
Edexcel Limited copyright policy.
2005 Edexcel Limited.
Printers Log. No.

M23050A
W850/R4400/57570 4/4/4/4/

Turn over

*M23050A0112*

Bus142302_M23050A.qxd

09/02/2005

11:41

Page 2

Leave
blank

Read this page, then answer the questions which follow.

Context
RedHouse Hotels Ltd (RHL) is a private limited company that owns 20 hotels in the United
Kingdom (UK). RHL hotels are near airports or in the centre of towns and cities.
People who stay in RHL hotels are called guests. The guests are either tourists who are
visiting the UK on holiday, or business people working in the area.
Jas is the Manager of the RHL hotel in London, which has 120 bedrooms. Guests use the hotel
facilities, which include
z
z
z

a bar and restaurant

a fitness and leisure centre with a swimming pool
car parking.

The layout of the hotel is shown below.

Fitness and
leisure centre,
with a
swimming pool

Bar and
restaurant

Car parking

Bedrooms

Hotel
reception

The directors of RHL have the following plans to increase turnover.

z
z
z

Employ a person to set up an Internet website for RHL, because the company does
not have one at the moment.
Improve the quality of service offered by all staff at RHL.
Set up a membership scheme for people not staying at RHL hotels to use the hotels
fitness and leisure centre facilities.

*M23050A0212*

Bus142302_M23050A.qxd

09/02/2005

11:41

Page 3

Leave
blank

Answer ALL questions.

1.

(a) For questions (i) - (v), write the letter A, B, C or D to show the correct answer. Use
the boxes provided.
(i) The owners of RHL are called
A managers
B shareholders
C staff
D customers
Answer
(ii) RHL is in which sector of the economy?
A primary
B secondary
C tertiary
D quarterly
Answer
(iii) A factor of production used by RHL is
A franchising
B labour
C quality
D productivity
Answer
(iv) The taxes paid by RHL are set by
A the government
B its customers
C its suppliers
D personnel staff
Answer
(v) The cost of food sold in the restaurants of RHL is an example of
A a capital cost
B a fixed cost
C an opportunity cost
D a variable cost
Answer
(5)

*M23050A0312*

Turn over

Bus142302_M23050A.qxd

09/02/2005

11:41

Page 4

Leave
blank

(b) Using information in the context (page 2), suggest why RHL hotels are located
(i) near airports
................................................................................................................................
................................................................................................................................
................................................................................................................................
(ii) in the centre of towns and cities.
................................................................................................................................
................................................................................................................................
................................................................................................................................
(4)
(c) Jas, the Manager of the RHL hotel in London, has money he wants to invest. Jas can
invest in the business his sister runs as a sole trader, or he can buy shares in
RHL.
Explain one benefit to Jas from investing in RHL rather than in his sisters business.
.......................................................................................................................................
.......................................................................................................................................
.......................................................................................................................................
.......................................................................................................................................
.......................................................................................................................................
(3)
(d) RHL benefits from economies of scale.
(i) What does the term economies of scale mean?
................................................................................................................................
................................................................................................................................
................................................................................................................................
(2)

*M23050A0412*

Bus142302_M23050A.qxd

09/02/2005

11:41

Page 5

Leave
blank

(ii) From the context (page 2), give one reason why RHL benefits from economies
of scale.
................................................................................................................................
................................................................................................................................
................................................................................................................................
(2)
(e) Explain how RHL could benefit from each of these economies of scale.
Marketing.......................................................................................................................
.......................................................................................................................................
.......................................................................................................................................
.......................................................................................................................................
Purchasing......................................................................................................................
.......................................................................................................................................
.......................................................................................................................................
.......................................................................................................................................
(4)

Q1

Total for Question 1: 20 marks

*M23050A0512*

Turn over

Bus142302_M23050A.qxd

09/02/2005

11:41

Page 6

BLANK PAGE

*M23050A0612*

Bus142302_M23050A.qxd

09/02/2005

11:41

Page 7

Leave
blank

2.

(a) What are the differences between a Profit & Loss Account and a Balance Sheet?
.......................................................................................................................................
.......................................................................................................................................
.......................................................................................................................................
.......................................................................................................................................
.......................................................................................................................................
.......................................................................................................................................
(4)
(b) Employees are stakeholders of RHL.
(i) Give two reasons why employees, as stakeholders, will be interested in the final
accounts of RHL.
................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................
(4)
(ii) Name two other groups of stakeholders in RHL.
................................................................................................................................
................................................................................................................................
................................................................................................................................
(2)

*M23050A0712*

Turn over

Bus142302_M23050A.qxd

09/02/2005

11:41

Page 8

Leave
blank

This years final accounts for RHLs London hotel contain the following information.
000

000

Turnover
Cost of Goods Sold
Gross Profit
Expenses
Net Profit

1 800
1 350
450
360
90

Fixed Assets
Current Assets
Current Liabilities
Net Assets

2 750
250
200

50
2 800

Capital

2 800

(c) Using the formulae below, calculate the Gross Profit and Net Profit ratios for the
London hotel. Show all your working.
Formulae:
Gross Profit ratio =
Net Profit ratio

Gross Profit
100
x
Turnover
1
Net Profit
Turnover

100
1

(i) Gross Profit ratio

................................................................................................................................
................................................................................................................................
................................................................................................................................
(ii) Net Profit ratio
................................................................................................................................
................................................................................................................................
................................................................................................................................
(4)

*M23050A0812*

Bus142302_M23050A.qxd

09/02/2005

11:41

Page 9

Leave
blank

Last year, the London hotels ratios were as follows.

z
z

Gross Profit ratio

Net Profit ratio

24%
6%

(d) Compare last years Gross and Net Profit ratios with this years. Assess how well the
hotel has done this year.
.............................................................................................................................................
.............................................................................................................................................
.............................................................................................................................................
.............................................................................................................................................
.............................................................................................................................................
.............................................................................................................................................
.............................................................................................................................................
.............................................................................................................................................
.............................................................................................................................................
(6)

Q2

Total for Question 2: 20 marks

*M23050A0912*

Turn over

Bus142302_M23050A.qxd

09/02/2005

11:41

Page 10

Leave
blank

3.

(a) (i) What is the difference between a Job Description and a Job (Person)
Specification?
................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................
(2)
(ii) How will these help the directors recruit a suitable person to create the new
website?
................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................
(2)
(b) A new member of staff will go on RHLs induction training programme.
(i) Describe the purpose of induction training.
................................................................................................................................
................................................................................................................................
................................................................................................................................
(2)
(ii) Identify three items likely to be found in RHLs induction training programme.
................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................
(3)

10

*M23050A01012*

Bus142302_M23050A.qxd

09/02/2005

11:41

Page 11

Leave
blank

(c) At present, people who want a hotel room either use the telephone or book directly at
the hotel Reception. The directors plan to offer a lower price for a room if people
book through the website, www.rh.co.uk.
(i) Give the name of the pricing strategy that the directors plan to use for website
bookings.
................................................................................................................................
................................................................................................................................
(1)
(ii) Explain two likely reasons why the directors plan to use this pricing strategy for
website bookings.
................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................
(4)
RHL will use the website for advertising.
(d) Justify RHLs decision to use a website for advertising.
................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................
(6)

Q3

Total for Question 3: 20 marks

TOTAL FOR PAPER: 60 MARKS
END

*M23050A01112*

11

Turn over

Bus142302_M23050A.qxd

09/02/2005

11:41

Page 12

BLANK PAGE

12

*M23050A01212*