J204 - Paper 2 MCQs

A company makes wooden jigsaw puzzles. By law, the company must:

• buy its wood from local suppliers

• deliver the jigsaw puzzles in electric vans

• replace any pieces that customers lose

• use paint that is non-toxic and safe

Which of the following is least likely to be a reason for a business to need finance?

• To decrease the size of the workforce

• To extend a marketing campaign

• To increase the size of its factory

• To reduce the amount of stock it purchases

Which of the following would be fixed costs of a fruit farm?

• Farm workers’ wages

• Plant food and fertiliser

• Rent and rates

• Seeds and seedlings

Four years ago an entrepreneur invested £200,000 to start their own business. The business is making an average profit of £53,000 per year. The entrepreneur’s average rate of return is:

• 6.6%

• 26.5%

• 73.5%

• 106%

Emma and Henry are in a partnership that runs a small building firm. Despite being profitable, the business is having difficulty paying all its expenses. Which of the following would help Emma and Henry deal with this problem?

• Holding larger stocks of raw materials

• Increasing the labourers’ wages

• Issuing shares

• Taking on a new partner

Financial data for Pilti plc in 2022 is shown below. Pilti plc’s gross profit in 2022 was:

• £18 million

• £26 million

• £32 million

• £58 million

An extract from Yoshi's Sweet Shop's cash flow forecast for November is shown below. Yoshi's Sweet Shop's opening balance for December is expected to be:

• £4700

• £4800

• £14200

• £14300

Which of the following is an advantage of receiving trade credit?

• It can be used to pay wages and salaries

• It encourages production operatives to work harder

• It is often interest free

• It may bring new skills into the business

A manufacturer of diamond rings employs sales staff to visit jewellery stores across the UK to encourage them to purchase its products. Which of the following is an advantage to the manufacturer of selling face to face to jewellery stores?

• The cut and colour of the diamonds can be clearly demonstrated

• The jewellery stores have the opportunity to negotiate very low prices

• The risk of the rings being stolen is kept as low as possible

• The sales staff can give out lots of free samples

Globalisation refers to:

• the financial data used to measure the success of a multinational company

• the interconnected nature of business activities across the world

• the interdependencies that underpin decision-making in a large organisation

• the relationships that exist between the functional areas of a business