*** F9 June 2015 Exam was.. Instant Poll and comments ***

@afuyegallas said:
Exactly what I did for the extra interest part. And I arrived at $19K net cost.

Did u use a net benefit/net cost approach? I asked bcos there is another way to do it in full by calculating all the costs in full and not just the differentials.
I’m sure some people mixed both methods up somehow

It’s not mixing up methods – we all did a cost/benefit approach – we just have different answers for the advance interest based on either using receivables balance or invoices raised.

Factor was acceptable.

Benefit 50000 Admn cost
bad debt 1×2675000×70
recevable were more then 4 million revised 35/360×26750000 the difference was above a million and multiple 5% cost of it saving.

Cost
0.0075×267500000
Revised receivable 35/360×26750000×2%
Acceptable

@jenny3549 said:
Exactly!!!

I thought the point was to cover a good range of the syllabus but they didn’t. Loads were left out and it was all on markets etc. Nothing like practice ones – and I did plenty!!

You seem pretty spot on methods and marks Jenny, you’ll pass comfortably!
But I don’t think there was 5 questions on MCQ’s to do with WACC, Inventory, Working Capital, investment appraisal etc, 1 little FX.

I know next time if I need to resit September, I’m going big on theory and just try to learn the textbook. Which considering it’s meant to be a practical exam doesn’t really help you, disappointing from acca.

What’s even more frustrating is they don’t release the questions for section A.

Yeah, i divided it by old number of shares :/ then multiplied it by current p/e ration to compare with theoretical ex rights price. Because my new eps was incorrect, the comparison should be wrong as well. But this was the only issue

@jenny3549 said:
It’s not mixing up methods – we all did a cost/benefit approach – we just have different answers for the advance interest based on either using receivables balance or invoices raised.

I definitely got the calc’s wrong by the looks of it. I calculated the factoring cost on the receivables *80% – but at 7%, not 2%. Didn’t think about the 5% finance cost to net against the advance from the factoring company.
Although I concluded that the factoring was not worthwhile , hopefully I get some method marks for the other calculations 🙂

I completely messed up Q4. Did a few calculations which I’m hoping might pick up a mark or two. I calculated a TERP, was that neccessary? worked out a P/E ratio, was that neccessary? not a clue.

Yeah, bpp revision kit has two similar questions and acca just combined them in one. I knew what to do, just made a small mistake in the very end

@nirjhardey said:
guys i think we r just wasting time talking about part b..part b questions was easy enough depending on ones preparation. and it doesnt really matter if we get a few things wrong..as we will still get most of the marks for methods and calculations..having said that i dont know what to expect from acca anymore. so lets talk about part a guys where i think most of us had serious problem as questions were not only tricky some of them were not even in the study text.i would really appreciate if any of u think u done quite alright in sec a then pls come forward and share the answer with us. thnk u

lol, read back though the forum – everyone’s been discussing the MCQs in Section A. Some of us have also posted our answer choices too.

I think m gonna have to resit this paper. I have it like 1% of my time. 99% of my time was spent on P1 and P2. To be fair I only revised in the last 5 days and left chapters out.

Q4 for me was tricky. Q2 put of me off but I think I might get a mark or 2 for stating the rule of dvm and earning yield method.

Nevertheless. Move on. F9 is history.

Best of luck everyone 🙂

@emo777 said:
Really? Didnt know that. Just forgot to add additional 4000000 shares to existing 20000000. So, has 20 in denominator, instead of 24

Yep, you’ll be fine – we tend to forget they don’t penalise us more than once for getting something wrong. It’s like the NPV question, if someone had forgotten to inflate the selling price they could still get 8/9 (or even 8.5 depending on the mark for inflation).

I think you messed up with 5% premium 😀 i think it was given to mislead us. The thing you had to do is to multiply net cash raised after issue costs by 100 and then divide by 104 to find the nominal value of loan to be redeemed. The you calculate the saving on interest. They took it from bpp revision kit, and you need premium only for calculation of cost of redeemable debt, which was not relevant in this case.

That’s a bit reassuring Jenny. I also calculated that we could buy back 100,000 bonds @ 109.20?

For the second part of the question I spoke about traditional theory and M&M. I mentioned about the tax shield effect when paying interest as opposed to dividends which are not tax deductable. I concluded that paying off the debt will probably not acheive the aim of optimising the WACC as the debt is cheaper?

Part B of Q4 I wrote about my life story 🙂