Please vote in our Instant Polls about the ACCA Paper FM December 2018 Exam
ACCA Forums
FM*** ACCA Paper FM December 2018 Exam was.. Instant Poll and comments ***
Why was that so hard?
It was actually a disaster! Kaplan tutor said dec examiner is nice! YEAH RIGHT!
I think I'll pass. Cash flow sum was good. Did y'all get a positive NPV while solving with corporate taxation buy option in the 32nd sum? The lease was a negative NPV though. Fair enough.
There was a lot of trick guestion. onlu cash flow was easy i think. The was guestion with forward rate agreement with two rates it was hard
For me it was ok
Anyone got an NPV question? I got a negative amount.
The second question in section c was a debt/equity question?
no we dont have npv guestion in Azerbaijan. second guestion was lease and buy
Sorry negative NPV in both lease and buy*
i dont know i have no time to make it correctly. because have i mistake in cash flow guestion and it take me a lot of time to recalculate
Really? I didn’t get a lease and buy
Disaster!
One hell of a paper it was. Section B & C were so damn hard. Never imagined it will go like this.
Hoping for a pass this time.
Section B, Q#26--30 was disaster. The area was risk management.
@sanjanapaul1234 said: I think I'll pass. Cash flow sum was good. Did y'all get a positive NPV while solving with corporate taxation buy option in the 32nd sum? The lease was a negative NPV though. Fair enough.what do u mean by lease I had a uestion in part C about NPV and a machine of 1m but there was nothing mentioned about leasing it was just mentioned about buying
The exam was so easy that it had you racking your brain. ACCA really got us. smh
Yess
@dipatil said: what do u mean by lease I had a uestion in part C about NPV and a machine of 1m but there was nothing mentioned about leasing it was just mentioned about buyingI think I got this question! Was your NPV negative??
I had a ques on NPV with operating profit given..I think we had to add back depreciation..
Investment was 100M and scrap value 50M
Working capital based on 15% of operating profit
Tax was paid in arrears Tax rate was 20%
TAD based on 25% reducing balance
I got -ve NPV
@mosesdawodu said: Why was that so hard?I really cant understand it, I never had any of the mock exams with such a challenging Section A, and I did all the papers I could find....Like seriously most multiple choice questions were absolutely ridiculous in terms of difficulty...
Section C
EAC
Cost of the Asset $860 000
scrap $60 000
Life of Asset 5 Years
Bank Loan with 8%
Buy
Lease £160'000 per year for 5 years
Tax 25% in arrears
depreciation was on a straight line
what answers did you get???
and the second question was based on cashflow statement
i got a positive balance of $344'000 end of sep???
The questions were around:
Cash flow forecast,
Reasons for holding cash,
Improving cash management
Lease and buy (Tax and without tax)
IRR as an investment appraisal method
Risk adjusted discount rate
I expected questions on WACC, NPV, Business valuation, Capital structure but alas... Had to restrategize
EAC
Cost of the Asset $860 000
scrap $60 000
Life of Asset 5 Years
Bank Loan with 8%
Buy
Lease £160’000 per year for 5 years
Tax 25% in arrears
depreciation was on a straight line
can any one help with the depreciation calculation????????????????
and the second question was based on cashflow statement
i got a positive balance of $344’000 end of sep???
I had the question on lease and buy - I got negative answers for both -but lease was less than buy so I said lease is cheaper option. Also I think I messed up the buy because I deducted interest from the loan payment (which I think is wrong). I did add back tax relief. Please advise. I found the paper extremely tough specially multiple choice questions and foreign exchanfe
Yes lease was cheaper in both the options. There were only 3 items to include in npv which was the TAD relief, residual value n investment cost at year 0. The rate you had to use was the IRR post tax given in the qn. While calculating Npv without tax effect you had to remove tax from that IRR. The interest rate given was only used for calculating lease (post tax cost of borrowing)
Glad to see others got a negative NPV for the question in section C, i feel a little better about knowing that i though i had messed up somewhere. I had the exam with the debt/equity question in section c as well. Generally though it was a horrible paper a lot of tricky questions and loads where you had to write your own answer in the multiple choice section. Was hoping for a WACC question but didn't even get a 2 mark one
@sarah1905 said: Glad to see others got a negative NPV for the question in section C, i feel a little better about knowing that i though i had messed up somewhere. I had the exam with the debt/equity question in section c as well. Generally though it was a horrible paper a lot of tricky questions and loads where you had to write your own answer in the multiple choice section. Was hoping for a WACC question but didn't even get a 2 mark oneIt seems you totally had a different paper because we had nothing about wacc n the normal Npv qn in today's paper
balanced, I always find section A easier next Section C and lastly Section B is the most difficult. seeded questions were from Section B with OT from currency exchange. I can say exam was easy for the first time. however there were alot of catches specially with easy exams.
Section C 12 mark was NPV calculation profit figures with 5 % inflation
TAD reducing balance and tax 20 %.. Got NPV negative
8 mark discursive Q was regarding the benefits of using probability analysis in investment appraisal.
Section Q in section C preparing cashflow forecast with closing balance also negative.
Discursive advice how to improve cash collection 6 mark
and 6 mark also for reasons why businesses keep cash.
@huzaifa11 said: EAC Cost of the Asset $860 000 scrap $60 000 Life of Asset 5 Years Bank Loan with 8% Buy Wasn't the Depreciation element to do with the taxation, as in its usually on a 25% reducing balance method, it was for the useful life of the asset the 5 years in order to calculate the tax benefits per year....That's how I looked at it I could be wrong though... Lease £160’000 per year for 5 years Tax 25% in arrears depreciation was on a straight line can any one help with the depreciation calculation???????????????? and the second question was based on cashflow statement i got a positive balance of $344’000 end of sep???
The multiple choice questions were so tricky. Thankful for the theory questions. Cash budget and lease versus buy decision question would really help lots of us earn marks that would enable us pass.
I did not add back depreciation but yes negative NPV. Did you get negative cash flows for some years?
This was similar to my workings too. ??
Unfortunately, i could not attent the exam. I am in QE and Friday is one of the crucial day for the closing. I believe that having the exam in the first week of the month is a ridiculous and irrespectful choice for ACCA. Most of the students works also in finance department and, the last and first week of the month are the most busy ones for the closure activities. If only ACCA moves the exams in the middle of the month, it would be easier for working students to sit the exams.
I wrote them several times on this, but the are stone deaf.
Topic lockedNew replies are closed.