FM*** ACCA Paper FM June 2019 Exam was.. Instant Poll and comments ***

@xanpech said: I kind of felt the same way, did the BPP revision kit 3 times! And the past exam papers, but only 50/50 if I passed coz found section A and B harder than I expected and often you just have to get one thing wrong and lose the whole 2 marks. Most annoyingly I somehow had a blank on the price/earnings ratio question, then as soon as the exam was over I realized what I should have done and its not even a hard question, so I think it was partly exam stress getting to Yes the price to earnings one was tough - ended up getting 2231 or something like that but I’m sure I probably missed something out on the calculation

@snell123 said: Yes but there was a question before that were you had to work out the required return. It was something like current dividends value was 725m which equates to 14.5 per share with annual growth of 2.7% divided by share price of 65 then add the growth on

@wigjimin said: hi i had converted 2.7% into 3 so it'll still be valid right???

@tonim said: I also got the working capital which initially baffled me. When I reached the quick ratio question I couldn’t get an answer that was there, but then I re-read the question. It was asking for the quick ratio of the NEXT year, which included an additional debt of some sort. Using this information I got an answer. I got section C questions on CAMP and DGM which asked only for Merits and was worth 6 marks. I said that CAPM was universal for new project that companies are unfamiliar with because it looks at the current market and what the risk for a similar project it, which gives a good indication of how much the funding of such a project is currently costing. I went on the day that DGM was not as good as CAPM for the validation of projects, but it considered growth which should enable companies to consider future dividends for equity. I don’t know if I got any marks here. I also got the question on Islamic Financing and I panicked so listed 4 with explanations - Sukuk- debt finance (irrelevant but oh well), Mudaraba (shareholders and agents), Musharaka (joint venture) and Ijara (lease finance) I also explained the concept of Islamic financing and probably spent too much time on this question (but I was pretty proud as I’d been studying Islamic financing that morning). I also got the NPV question. I got a positive NPV. Depreciation calculation on a reducing balance at 25% works as follows: Y1) 1,000,000 * 25% = 250,000 allowance. Y2) (1,000,000 - 250,000) * 25% = X (don’t have a calculator). Your final allowance is calculated by deducting the scrap value from the remaining balance in Year 4 (from the question). This is your remaining WDA allowance, this is multiplied by the tax rate to give you the final benefit. The amount I got was significantly high. I also put the allowances in the years that they corresponded to, rather than the next year as it was in arrears... was this correct? I got a payback period of 3.25 years. I got this by doing a cumulative income chart and dividing the remaining negative balance by the total balance in year four. I said that the project should be accepted purely from a financial perspective, however as the directors had a two year maximum payback period and would automatically reject this project. On the next page I had to explain what they could do to improve their investment appraisal approach and I gave quite wishy washy answers on how they hadn’t considered new inflation rates and are likely to be outdate, that they shouldn't just be considering the payback period and that they may want to consider other methods such as IRR, RI, or ROCE. Please let me know if you disagree with my answers. It would be nice to know where I’m at. I got an awful section B foreign payments question which I pretty much just guessed! I was diagnosed with tendinitis is my writing arm on Monday and sat two exams. I’ll be so happy if I pass them given my amount of effort ?

@ajaved5 said:

@tonim said: On NPV cash flow, you inflate by the 4%. E.g £100 sales inflated at 4% would be Y2: 100 * 1.04 Y3: 100 * 1.04 * 1.04 Y4: 100 * 1.04 * 1.04 * 1.04 etc. You do not inflate year 1 as this is your base figure.

@ajaved5 said: I got that wrong, I started inflation at t1. What about the residual value undiscounted at 5%

@xanpech said: I also inflated from year 1, I think this is correct though? As the cash flows represent the end of each year and no inflation had been applied to any of the figures.

@mareeam said: Pls what was npv value I got about 3m Did u add scrap value to d npv calculation I got 2yr 7month for payback cal. Pls what was NPV for that question