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F2 paper question

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA LW Exams › F2 paper question

  • This topic has 1 reply, 2 voices, and was last updated 13 years ago by MikeLittle.
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  • November 30, 2011 at 12:02 am #50804
    salgunaidi
    Member
    • Topics: 3
    • Replies: 5
    • ☆

    Hi,

    I am a little unclear with question 11 on pilot paper F2 Dec 2011.

    The question is:

    A company has a capital employed of $200,000. It has a cost of capital of 12% per year. Its residual income is $36000.

    What is the company’s return on investment?

    Answer is (A) which in this answer gain is added to cost, and the formula as I understand subtracts the cost. So I am little confused as to why this is added?

    December 4, 2011 at 1:35 pm #90396
    MikeLittle
    Keymaster
    • Topics: 27
    • Replies: 23323
    • ☆☆☆☆☆

    Do you know of any good reason why this is posted on the F4 ask the tutor page?

    Why not post it in the chat room or in the F2 forum?

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