Business Calculations L2 Past Paper Series 4 2009

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2003/4/09 Page 1 of 6 ASE 2003 4 09 1

Series 4 Examination 2009

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.

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 displayfacilities, is silent and cordless. The provision of batteries and their condition is your responsibility.

BUSINESS CALCULATIONS

Level 2

Friday 6 November

Subject Code: 2003

Time allowed: 2 hours 30 minutes



2003/4/09 Page 2 of 6

Answer all questions

QUESTION 1

(a) Daniel makes three investments at simple interest.He invests £5,250 in each.

(i) Investment A is for 3 years 2 months at 4% per annum.Calculate the amount of interest received.

(3 marks)

(ii) Investment B is at 4.2% per annum, and gives interest of £771.75.Calculate the duration of the investment.

(3 marks)

(iii) Investment C is for 4 years. At the end of the period the amount invested has increased to £6,079.50.Calculate the rate of interest.

(3 marks)

(b) Evangeline invests $7,000 at 3% compound interest.Calculate how much more interest is received in year 3 than in year 1.

(5 marks)

(Total 14 marks)

QUESTION 2

A retailer’s total sales in a year were £415,000. The cost price of goods sold was £178,200.

During the year the following overheads were paid:

£Wages 92,500Electricity & gas 7,605Telephone charges 685Premises 32,400Office expenses 11,480

(a) Calculate the net profit as a percentage of the total sales.(4 marks)

The telephone charges include a fixed charge for line rental, together with all the following callcharges:

Band A: 7,210 minutes at 2.5p per minuteBand B: 1,950 minutes at 3.2p per minuteBand C: 4,327 minutes at 5.0p per minute

(b) Calculate the charge for line rental.(4 marks)

The electricity and gas charges include a charge for electricity of £2,350, a charge for gas, and adiscount of 10% of the total for buying both from the same supplier.

(c) Calculate the amount charged for gas before discount.(3 marks)

(Total 11 marks)



2003/4/09 Page 3 of 6

QUESTION 3

(a) Janet earns £1,750 per month, plus commission of 2.5% on sales.In 2008, she sells goods worth £282,000.

Calculate her gross income, including commission, in 2008.

(3 marks)

(b) In the financial year 2008 to 2009, a total of 52 weeks, Kelly earns a total of £35,400.She pays National Insurance each week according to the following table:

First £90 NIL Salary over £90 and under £770 11% Salary £770 and over 1%

For example, someone who earns £300 in a given week will pay 11% of £210.

Each week, Kelly earns between £90 and £770.

Calculate the amount of National Insurance paid by Kelly during the year.(4 marks)

(c) In a small business, 7 employees earn £21,000 per annum each, 2 employees earn £24,500 per annum each, and one employee earns £33,400 per annum.

Calculate the average annual earnings per employee.(4 marks)

(Total 11 marks)

QUESTION 4

An office manager orders the following items.

Quantity Description Unit cost

12 boxes ball pens £2.95 per box4 cartons pencils £5.31 per carton25 rulers £0.09 each

(a) Calculate the total cost of the above items.(3 marks)

The office manager also orders 50 corrector pens, bringing the total cost of the items to £76.39.

(b) Calculate the cost of one corrector pen.(3 marks)

The total order, including corrector pens, is subject to a trade discount of 12%.

(c) Calculate the invoice total after trade discount.(3 marks)

The office manager earns a further discount of 10% of the invoice total for prompt payment.

(d) Calculate the amount paid.(3 marks)

(Total 12 marks)



2003/4/09 Page 4 of 6

QUESTION 5

A retailer’s premises are valued at £440,000 with contents valued at £185,000.

Insurer A offers annual insurance premium rates as follows:

Buildings £7.88 per £10,000 insuredContents £2.02 per £1,000 insured

(a) Calculate the total annual premium with insurer A.(3 marks)

Insurer B offers annual insurance premium rates as follows:

Buildings €10.85 per £10,000 insuredContents €26.70 per £10,000 insured

(b) Calculate the total annual premium in Euros with insurer B.(3 marks)

(c) Calculate the total annual premium in pounds with insurer B.Use an exchange rate of £1 = €1.25

(2 marks)

(d) Advise the retailer on which insurer to choose.(1 mark)

Petra’s car is insured for an annual cost of £732.The car is involved in an accident, and the insurance company finds that the car was insured for only80% of its true value.

(e) Calculate:

(i) The compensation paid for accident repairs costing £1,800(2 marks)

(ii) The cost of insuring the car for its full value.(2 marks)

(Total 13 marks)



2003/4/09 Page 5 of 6

QUESTION 6

A retailer buys a new till with a cash price of £1,650. The hire purchase terms require a deposit of 30%of the cash price, and monthly payments over 3 years. After payment of the deposit, simple interest of 35% is charged on the balance remaining.

(a) Calculate:

(i) the amount of the deposit(2 marks)

(ii) the balance owing(2 marks)

(iii) the interest charged.(2 marks)

(b) The hire purchase company calculates the amount of each monthly instalment, and rounds thefigure to the nearest penny.

(i) Show that the amount calculated for each monthly instalment is £43.31;

show all your working.(4 marks)

(ii) Calculate the total amount paid for the new till(2 marks)

(iii) Based on the total amount paid, calculate the average amount paid per month.(2 marks)

(Total 14 marks)



2003/4/09 Page 6 of 6 © Education Development International plc 2009

QUESTION 7

Simon and Cheryl set up a partnership business on 1 January with invested capitals of €54,000 and €81,000 respectively. They trade mainly in Britain and on 1 July they shared profits of £15,000 inproportion to their capital invested. In addition, Simon received a salary of £1,400 per month.

(a) Write the ratio of their investments in its simplest terms.(2 marks)

(b) Calculate how much each partner received in total for the first 6 months of trading.(4 marks)

(c) Given an exchange rate of €1.20 to the £, calculate the total profit as a percentage of thetotal investment.

(4 marks)

At the start of the second year of trading, Robert joins the partnership, making an investment of £32,400 at an exchange rate of €1 = £0.80.

(d) Calculate the new ratio of the investments of the three partners in its simplest terms.(3 marks)

(Total 13 marks)

QUESTION 8

Annie checks the cost of a new games console on the internet.She finds the following prices, including UK delivery.

Britain £269United States $468France €319

(a) Using exchange rates of €1 = £0.82 = $1.5, calculate:

(i) the average price in pounds(5 marks)

(ii) the saving, if any, that Annie can make by buying the console outside Britain.(2 marks)

Annie checks more prices in the United States, and finds that they are as follows:

1 at $4683 at $4697 at $477

(b) Calculate the average price of these 11 games consoles.(3 marks)

(c) Convert the British price of £269 to US dollars at the above exchange rates.(2 marks)

(Total 12 marks)

(Total 100 marks)

Documents

Business Calculations L2 Past Paper Series 4 2009