ACCA F9 Revision Download F9 Question Paper
ACCA F9 December 2014 Section B Question 5
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sorry I used a guess of 10% and 5% but the answer looks a bit high. kindly explain
How can I explain your figures without seeing them? You will know from my free lectures for F9 (and for F2) that any IRR calculated using two guesses is only ever an approximation, because the relationship is not linear.
Thank u sir
You are welcome 馃檪
Dear John, Thank you for the brilliant explanation of the question, am just confused about one thing in valuation of debt why do we use the IRR to ascertain the cost of the debt and not the risk free rate of return? and if we were given a cost of capital example 10% could we use that calculate the Present value of the loan note? or we still have to ascertain the IRR?
sorry if my question is jumbled up
thank you
Hi Sir,
I did not get part b Gearing and financial risk point. Need explanation on that.
Steffietheresa, it is because the nominal value of each ordinary share is 50 cents. The other way is to divide the total nominal ordinary shares value of 200 by the nominal value per share of 0,50 which will give us 400 shares then multiply by 5,85. Hope it helps! 200/0.5*5,85=2340.
Hi John, can you please explain why is it a multiply of 2 in the total M.V for equity (200 x 2 x 5.85)
Thank you.
1 SHARE=$0.5
2 SHARES=$1
400 SHARES = $200
400SHARES @ $5.85