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7115 w12 in 21 .pdf



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Title: 11_7115_21_2012_62978.indd
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
General Certificate of Education Ordinary Level

7115/21

BUSINESS STUDIES
Paper 2

October/November 2012

INSERT
1 hour 45 minutes
READ THESE INSTRUCTIONS FIRST
This Insert contains the case study material.
Anything the candidate writes on this Insert will not be marked.

This document consists of 3 printed pages and 1 blank page.
DC (NF/SW) 62978
© UCLES 2012

[Turn over

2
K’s Garage
Kolo has worked as a mechanic repairing motor cars for over 10 years. He now wants to start his own
business selling and repairing cars. He wants to set up as a sole trader business and call his business
K’s Garage. He hopes to have both business customers and private customers.
Kolo thinks he will need to employ two other trained mechanics, as well as two experienced sales staff
for selling cars. Kolo will do the accounts and administration for the garage and also deal with customer
enquiries.
There are three possible sites where he could locate his garage.
Site A:
Site A is on a busy road close to the city centre. The rent on the property is $20 000 per year for a small
workshop and car showroom (where cars for sale are displayed). It is near other garages which sell
new cars. The site is located in a business area and there are no houses nearby.
Site B:
Site B is on a road on the edge of a housing estate. There are many people living in the area who own
cars. The rent for this site is $15 000 per year. The site has a large car showroom and workshop. There
are no other garages in the area and only a few shops nearby which sell food. Not many people use the
road.
Site C:
Site C is in an area outside the city with no housing or businesses nearby. The site is for sale for
$10 000. It is a large area of land with a big garage on the site, but the buildings need repairing. There
is a busy road nearby which leads into the city. The city is 10 kilometres away.
Kolo’s friend, Leslie, owns a garage in another city. Leslie has given Kolo the following information from
his company accounts. This is shown in Appendix 1.

Appendix 1
Financial information for Leslie’s garage ($)

Capital employed
Sales revenue from car sales
Sales revenue from car repairs
Cost of sales (cars and car parts)
Expenses

© UCLES 2012

2010

2011

50 000
40 000
60 000
20 000
70 000

50 000
80 000
70 000
40 000
90 000

7115/21/INSERT/O/N/12

3
Appendix 2
To: Kolo@gotmail.com
From: Leslie@gotmail.com
Hello Kolo
If you are thinking of importing cars for your business you need to consider a few things.
Changes in the exchange rate may affect the price you are paying for the imported cars. Also you need
to check if there are any tariffs or quotas on imported cars. However, the prices are often 20% less than
buying cars in this country and there are more types and models of cars available from other countries.
Remember transport costs may be higher and delivery dates may be less reliable.
Good luck!
Leslie

Appendix 3
Economic data
Unemployment

Economic growth

6
5

8
7
6
% 5
4
3
2
1
0

%

2
1
0
2009

© UCLES 2012

4
3

2010

2011

2012
(forecast)

7115/21/INSERT/O/N/12

2009

2010

2011

2012
(forecast)

4
BLANK PAGE

Permission to reproduce items where third-party owned material protected by copyright is included has been sought and cleared where possible. Every
reasonable effort has been made by the publisher (UCLES) to trace copyright holders, but if any items requiring clearance have unwittingly been included, the
publisher will be pleased to make amends at the earliest possible opportunity.
University of Cambridge International Examinations is part of the Cambridge Assessment Group. Cambridge Assessment is the brand name of University of
Cambridge Local Examinations Syndicate (UCLES), which is itself a department of the University of Cambridge.

© UCLES 2012

7115/21/INSERT/O/N/12


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