P230/2

ENTREPRENEURSHIP
EDUCATION
Paper 2
st
31 July 2024
3 Hours

KAMPALA WAKISO GIANT SCHOOLS’ ASSOCIATION (KWGSA)

National Joint Mock Examination 2024
Uganda Advanced Certificate of Education
ENTREPRENEURSHIP EDUCATION
Paper 2
3 Hours

INSTRUCTIONS TO CANDIDATES
Answer any four questions

Any additional question(s) attempted will not be marked.

All questions carry equal marks.

Credit will be given for the use of relevant diagrams and illustrations.

KWGSA Joint Mock Examinations 2024 Page 1 of 4

1. You are the marketing manager of a bakery producing a variety of baked items in your
home area.
(a) Design a flier to be issued to potential suppliers. (06 marks)
(b) What would you use to monitor your operations? (06 marks)
(c) Write a Memo to the sales staff about customer‟s complaint over the expired
products distributed to them. (07 marks)
(d) Formulate a code of conduct for promoting discipline in the bakery business.
(06 marks)

2. Simply click Ltd is a registered company dealing in the selling of internet services to
telecom service providers and large business enterprises in the country. It had the
following projections during the year 2023.
(i). The company expects to start operations in the first month of the last quarter of
year with share capital worth Shs. 8,000,000.
(ii). Cash sales are expected at Shs. 4,000,000 effective the first month of operation
and this is expected to increase in the following month by 10% and later
decrease by 5% in the monthly in the following months.
(iii). The business has a policy of collecting money from credit sales every after 3
months and the last collection was during the month of August 2023. Monthly
credit sales were Shs. 5,000,000.
(iv). As a way of getting more capital, during the second month of operation, the
business will float 60% of the share capital to the public payable in the month of
floating.
(v). The company also expects to receive a loan from Centenary bank Worth Shs.
3,500,000 during the second month of operation. The loan shall attract a
monthly interest of 10%. The interest is payable starting with the month of
acquisition and the principle in paid in as a single some after 3 months of
operation.
(vi). The business expects to sell all it computers at the end of the first month and
expects to collect Shs. 6,000,000. 40% of the collected amount shall be used
pay all out standings.
(vii). Monthly wage bill is Shs. 500,000.
(viii). Share holders receive their dividends at the end of every quarter which is
normally 10% of the initial capital.
(ix). Fixed running costs are Shs. 300,000.
(x). Taxes amount to 10% of the loan amount payable every month.

a) Prepare “Simply Click’s” Cash budget for the quarter in question. (15 marks)
b) Comment on the cash position of the business. (06 marks)
c) How Was the business able to minimize cash deficits for the said period.(04 marks)

3. You have accumulated funds to run a juice processing plant in a place you have just
recently rented along a busy route.
(a) What factors will you consider while choosing a better location for your
business? (06 marks)

KWGSA Joint Mock Examinations 2024 Page 2 of 4

 (b) Outline any four likely sources of employees you are likely to use in your
business. (04 marks)
(c) Draft a pre-operation budget for your project. (07 marks)
(d) Assuming that, part of the money was a loan from Wewumulire Sacco worth
Shs. 25,000,000 carrying an interest of 8% payable annually in the next four
equal instalments. Prepare a loan repayment schedule using the reducing
(16 marks)

4. The following trial balance was contained in the books of Ssorpan limited as at 31st
Dec. 2022.
Particulars Dr. (Shs) „000‟ Cr. (Shs) „000‟
Creditors / Debtors 50,000 30,000
Motor van at cost 100,000
Bank loan 300,000
Discount 20,000 10,000
Capital 410,000
Land at Cost 1,000,000
Carriage inwards 60,000
Rent 18,000
Provision for bad debts 20,000
Electricity 70,000
Bad debts 12,000
Salaries 80,000
Returns 100,000 50,000
Cash at hand 20,000
Cash at bank 40,000
Sales / Purchases 1,100,000 2,000,000
Stock (01/01/2021) 10,000
Equipment at cost 200,000
Accumulated depreciation
Motor van 20,000
Equipment 40,000
Total 2,880,000 2,880,000
Additional information
(a) Closing stock was valued at Shs. 200,000
(b) Half of the rent paid is for the forth coming financial year
(c) Salaries of shs. 20,000 were due.
(d) Provision for bad debts is to be charged at 5% of debtors.
(e) Depreciate equipment by 20% on cost and motor van by 10% on net book
value.

Required
Prepare Ssorpan limiteds‟;
(a) Trading, Profit and loss account (09 marks)
(b) Balance Sheet (10 marks)

KWGSA Joint Mock Examinations 2024 Page 3 of 4

 (c) Using your results from the income statement to compute and interpret the
business‟ (06 marks)
(i) Margin
(ii) Mark-up.

5. You intend to establish a small factory to produce hand sanitizers worth Shs.
50,000,000.
(a) Prepare a market survey guide you are going to use to get data from the field
concerning your company‟s products. (07 marks)
(b) How would you lower the costs of production? (08 marks)
(c) What factors would you consider when selecting tools, machines and
equipment? (05 marks)
(d) Design policy guidelines to ensure production of high quality product?
(05 marks)
6. (a) ASK Ltd employs five workers earning a monthly income as in the table below
Employee Monthly Salary (Shs)
Bonny 300,000
Martin 100,000
Regina 380,000
Morris 420,000
Allan 700,000
Given the income Payee tax rates below;.
Monthly Chargeable RATE OF TAX
Income (Shs)
0 – 235,000 Nil
235,000 – 335,000 10% of the amount by which chargeable income
exceeds Shs. 235,000
335,000 – 410,000 Shs 10,000 plus 20% of the amount by which
chargeable income exceeds Shs 335,000
410,000 – 10,000,000 i. Shs 25,000 plus 30% of the amount by which
chargeable income exceeds shs 410,000
ii. Above Shs 10,000,000, charge additional 10%

Calculate the income tax payable by each employee. (15 marks)

(b) Given the VAT rate as 18%, calculate the VAT payable at each stage in the
table below.
Stage Detail Cost Price Selling Price VAT payable
I Producer 2,000,000 ?
II Producer to wholesaler 2,000,000 2,400,000 ?
III Wholesaler to retailer 2,400,000 3,000,000 ?
IV Retailer to consumer 3,000,000 4,000,000 ?

END

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