- This topic has 159 replies, 48 voices, and was last updated 7 years ago by
.
- Posts
@demetrios21780 said:
I deducted also dividend for year 20×7.i found g=4.if u know the new dividend then it is definitely relevant with g.However this is only my opinion.I also choose aggressive for financing and in mch with irredemable I choose statement 1 is correct.In my personal opinion irredemable shares can be consider as share capital.Any opinions????? I might be totally wrong ?I deducted as well and got the same growth of 1.04 with the formula..so yes, g= 4.
I also chose Aggressive for financing but i’m not sure too!
I can’t remember what I chose for the irredeemable question but I think I went for only statement 1 is correct as well. I just googled it and got the general sense it is equity. Fount this also on Kaplan’s knowledge base:
“Redeemable preference shares are preference shares which are repayable by the company at a specified future date. On this date the shares are cancelled and the shareholders repaid.
These shares have the characteristics of debt. They are therefore classified as a liability on the statement of financial position.”“Irredeemable preference shares are preference shares which are not redeemable. They remain in existence indefinitely.
These shares are classified as equity on the statement of financial position.”Hopefully we are correct.
@heychi said:
I deducted as well and got the same growth of 1.04 with the formula..so yes, g= 4.I also chose Aggressive for financing but i’m not sure too!
I can’t remember what I chose for the irredeemable question but I think I went for only statement 1 is correct as well. I just googled it and got the general sense it is equity. Fount this also on Kaplan’s knowledge base:
“Redeemable preference shares are preference shares which are repayable by the company at a specified future date. On this date the shares are cancelled and the shareholders repaid.
These shares have the characteristics of debt. They are therefore classified as a liability on the statement of financial position.”“Irredeemable preference shares are preference shares which are not redeemable. They remain in existence indefinitely.
These shares are classified as equity on the statement of financial position.”Hopefully we are correct.
Growth of divi is was 5% as 20X7 to 20X3 as i remember (0.45/0.37)^1/4 – 1=.0.05 It seems that you used power of 1/5 instead of 1/4. Check.
My friend Heychi…..https://smallbusiness.chron.com/aggressive-vs-conservative-working-capital-65216.html.This shows that for conservative current assets ratio must be around 2.the current assets were nearly the same with current liabilities and fixed assets were the same as the amount for long term liabilities.Irredemable shares are treated as equity.
also i remembered this morning a mch about soft capital rationing…i choose the directors they dindt want to issue shares because they dint want mv of shares and dividend to fall down.
there was a question about ordinary share capital.I found 312.m.any other multible choice i cant remember…….
@davea said:
Growth of divi is was 5% as 20X7 to 20X3 as i remember (0.45/0.37)^1/4 – 1=.0.05 It seems that you used power of 1/5 instead of 1/4. Check.Hey, I did cubed root of: Last dividend/Dividend at the start according to the table to get the growth.
@demetrios21780 said:
My friend Heychi…..https://smallbusiness.chron.com/aggressive-vs-conservative-working-capital-65216.html.This shows that for conservative current assets ratio must be around 2.the current assets were nearly the same with current liabilities and fixed assets were the same as the amount for long term liabilities.Irredemable shares are treated as equity.also i remembered this morning a mch about soft capital rationing…i choose the directors they dindt want to issue shares because they dint want mv of shares and dividend to fall down.
there was a question about ordinary share capital.I found 312.m.any other multible choice i cant remember…….
I hope you are right as we have similar answers!
For the ordinary share according to market values i got 396 or 369..something like that but I honestly can’t remember if this is even the same question.
I wish I wrote down all my choices but the invigilator took my paper so quickly.
In limbo for for now but trying to focus on passing F5 for December.
Here are all the MCQs I can remember:
-Expected Value – usage i.e whether the company can use it
-Expected value with probabilities calculation
-Fisher formula question – which statement is correct?
-Dividend growth with cost of equity – MCQ1
-Market value of shares
-Value of rights ex market etc ( I never know the difference!)
-Interest Collar
-Efficiency is process, Economy is input.
-Price to earnings question and PBIT? (something about valuating a small company –using P/E ratio).
-Financial Management and it’s place in NFP organisations
-Working capital debate profitability/liquidity
-Equity Beta (MCQ 2)
-What government should do to stimulate growth (devalue currency).
-Use of factor and the net savings amount.
-Lead price and forward price difference for FEC
-Job of the Money market re. Letters of Credit.
-Aggressive/conservative approach
-Profitability Index
-Economic risk due to demand
-Theory of behavioural finance
-FRA $25,000 or $27,000 or something like that.
-Statement about Irredeemable preference shares being counted as shares for asset -valuation.
-Soft capital rationing
– Forward exchange rates reflect interest parity
– Efficient Market Hypothesis questionGod knows how I remember!
Passing for me right now is 50:50.@heychi said:
I hope you are right as we have similar answers!For the ordinary share according to market values i got 396 or 369..something like that but I honestly can’t remember if this is even the same question.
I wish I wrote down all my choices but the invigilator took my paper so quickly.
In limbo for for now but trying to focus on passing F5 for December.
How much WACC did you get? I got 11 point something.
@syeduzairnaqvi said:
How much WACC did you get? I got 11 point something.My WACC was wrong because I didn’t include the cost of the irredeemable preference shares. I couldn’t think to figure out the interest % for that. Hopefully that and the real answer maybe worth 4/5 marks out of 11.
@heychi said:
My WACC was wrong because I didn’t include the cost of the irredeemable preference shares. I couldn’t think to figure out the interest % for that. Hopefully that and the real answer maybe worth 4/5 marks out of 11.Cost of preference shares was 250000/3100000*100=8.06% I think
very correct.Kp=8/06%.For the discounted payback period if u found the correct 2.75 years tha means that your NPV MUST be correct??????so if someone found the 2 marks question the corect result that means that he took 9+2=11 points!!!!!??????i think this thought of me is correct!
@demetrios21780 said:
very correct.Kp=8/06%.For the discounted payback period if u found the correct 2.75 years tha means that your NPV MUST be correct??????so if someone found the 2 marks question the corect result that means that he took 9+2=11 points!!!!!??????i think this thought of me is correct!Payback period was 2.9 approx.
I have found 2, 74 years….. Appr.2 years and 9 months
https://opentuition.com/topic/irredeemable-preference-shares/
Payback answer will vary according to npv answer. There will be method mark as long you show ur full workings and calculations i believe
Guys can anyone remember what is the B question in the q31 wacc?
Something to do with importance/instances of the wacc for the investment appraisal ?? A 3 marks theory question thank youHi, guys! Does anyone remember how to treat variable rate of loan and how to calculate cost of debt in this case? I mean 31 question – 3 mln loan with variable rate. What is more they do not give interest rate to us – so it can not be used. My head is exploading)
This confused me too! I ended up just doing 1-tax rate so 1-0.3 and used 0.7 / 7% which is probably so wrong but I had no idea what to do with it!
I think it was to do with when should you not use the same WACC for investment appraisal, I made comments about a different kind of business, or if the funding for the project wasn’t included in the WACC as more debt or equity being raised would change the WACC.
For the conservative/aggressive approach, I read that to be moderate you had to cover your fluctuating assets with short term finance and non fluctuating with long term, I compared the two and it looked as though they had more long term finance than short, dependant on the fluctuating assets so I said that this was conservative approach.
Payback I also had 2.74, 2years 9 months.
I feel like most of the multiple choice questions are a blur now.
@psmill said:
This confused me too! I ended up just doing 1-tax rate so 1-0.3 and used 0.7 / 7% which is probably so wrong but I had no idea what to do with it!I almost, almost did the same thing in the exam but I had a feel it’ll be too wrong so I ignored it completely and just added the Mv of the bank loan without calculating its weight with the rest. Damn now I feel like using the after tax cost of capital could be right. Hopefully for your sake!
Hi everyone, I have just got the answer from “Ask the tutor” section reg variable loan rate:
“It depends what other information there is in the question.
If you are given the current interest rate then you would use that (obviously net of tax relief). If you are not given the current interest rate but there was other debt borrowing, then you would use the cost of the other debt borrowing.
But again, so much depends on what other information there is in the question.”
Can anybody remember what was the question for 3 marks in the q3.2?(NPV question)
- The topic ‘*** ACCA F9 September 2017 Exam was.. Instant Poll and comments ***’ is closed to new replies.