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- September 9, 2025 at 3:59 pm #719933
I had the version of the exam with APV, budget gyms acquisitions and multilateral netting and I feel same as everyone else. The questions were kind – I just wish I practiced my exam technique more as I did run out of time and left one 9 marks question out. This is my first attempt – one more exam left to become fully qualified after this, I am really hoping I’ll scrape enough marks.
August 2, 2025 at 12:15 pm #718627Hi there, I have come across a question where part of the investment was financed by a bank loan and part of it by a subsidised loan.
The question read as following:
”The finance director has proposed the following finance package for the new investment:$200m Bank loan, repayable in equal annual instalments over the project’s life,
interest payable at 6% per year
£300m Subsidised loan from a government loan scheme over the project’s life
on which interest is payable at 2.5%Issue costs of 2% of gross proceeds will be payable on the subsidised loan. No issue costs will be payable on the bank loan. Issue costs are not allowable for tax.”
Subsidised loan benefit calculation included:
1. Tax benefit $300m × 2.5% × 20% × AF(6%, 4) = $5.20m
2. Subsidy benefit: $300m × (6% ?-2.5%) × (1 – 20%) × AF(6%, 4) = $29.11m
3. Issue costsI am struggling to understand the logic behind the 2nd working. Could you explain this working step by step please?
Thank you,
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