Business Studies — BGCSE

Answer: Break-even = 1,200 bottles; margin of safety = 300 bottles

1. Contribution per bottle = 25 − 10 = P15
2. Break-even = fixed costs ÷ contribution = 18,000 ÷ 15 = 1,200 bottles
3. Margin of safety = 1,500 − 1,200 = 300 bottles
4. Unit required on both answers

Four marks means four visible steps. Learners who write only 1,200 usually score two of them — the contribution and the margin of safety are marks in their own right.

Answer: Two explained reasons, e.g. (i) it sells on credit, so profit is recorded before the customers pay; (ii) the van was a large one-off cash outflow that does not match the profit in the month it was paid.

1. Reason 1 with mechanism — credit sales: the sale is recorded as revenue, but no cash has arrived yet
2. Reason 2 with mechanism — the van purchase: a large cash payment in a month when profit was modest (or financed from cash reserves)
3. Alternative acceptable reason — building stock: cash is tied up in inventory that has not been sold
4. Each reason needs its own sentence and a consequence for the business

Profit is a calculation of income less expenses; cash is money in the bank. Any answer that explains one without naming how the timing differs is only half done.

Answer: By the farm: fresher fruit and lower transport and spoilage costs, because the raw material loses weight and quality during long journeys. In Gaborone: closer to customers and the main labour market, which lowers distribution cost and makes it easier to recruit and supervise staff.

1. Advantage one with a reason: near the farm → reduced transport and spoilage of perishable raw material
2. Advantage two with a reason: near the city → lower distribution costs to customers and better access to labour
3. A consequence for the business in each case (cost, quality or time)

Location answers are marked on the link, not the place. "Near the farm" earns nothing; "near the farm, because fruit spoils on a long journey" is a mark.

Answer: Job rotation

1. Non-financial means no money changes hands
2. Job rotation changes the tasks a worker performs

One-word test: could it appear on a payslip? If not, it is non-financial.

Answer: Creditable factors include proximity to existing customers and delivery costs, rent and rates, competition, foot traffic, staff availability, and whether the site supports both retail and wholesale.

1. Factor one, named and justified for this business (1 mark)
2. Factor two, named and justified for this business (1 mark)
3. Uses the context given: supermarkets, second branch, Serowe (1 mark)
4. A recommendation that follows from the two factors (1 mark)
5. A reason for the recommendation that a sceptical owner would accept (1 mark)

Use the context in the question by name. The word "Serowe" in your answer is often the difference between application marks and none.

Answer: Sole trader

1. One owner
2. Personally responsible for debts = unlimited liability

The giveaway is liability, not size. Many small businesses are companies precisely to separate the owner from the debts.

Answer: Contribution per unit = selling price − variable cost per unit = P15; total contribution = 1,000 × P15 = P15,000

1. Definition: the amount each unit contributes towards fixed costs and profit
2. Per unit: 40 − 25 = P15
3. Total: 1,000 × 15 = P15,000

Definitions must not use the word being defined. "Contribution is what it contributes" is the most common reason a definition mark is not awarded.

Answer: Depreciation of the delivery van

1. Cash flow records money actually moving
2. Depreciation spreads the cost of an asset over time and involves no transfer of money

This is the classic distinction question. If no money changes hands, it belongs in the income statement, not the cash-flow forecast.