No1.
PQR CO has a demand of 7500 unit per month. each unit cost $5; ordering cost $100,and inventory holding cost is 10% of purchases price per year.
there is a lead time of 30 days between placing an order and receiving delivery.
if they order the EOQ each time, at what level of inventory should a new order be place.
my answer is 6000 unit.
but correct answer is 7397 units.
No.2
A new project cost $160000.
Expected life - 4 years
Expected scrap value $20000
Net operating Cash flow as follow:
Yr 1 $40,000
Yr 2 $60,000
Yr 3 $80,000
Yr 4 $20,000
cost and capital 10%
what is the payback period(assumption the cash flow are received evenly with each year)?
my answer is 2yr 3mth
correct answer is 2yr 9mth
No.3
Today Exchange rate for sterling:
Euro/sterling 1.44
yen/sterling 232.11
US$/sterling 1.71
How many euro would you get to the US$?
my answer is 1.18
correct answer is 0.84
No.4
XYZ plc has a PE ration of 12 as against an average for the sector of 10.2.
which statement is possible reason for the higher PE?
1 shares in XYZ are currently over valued
2 shares in XYZ are currently under valued
3 shareholder are expecting higher than average growth from xyz
4 shareholder are expecting lower than average growth from xyz
my answer is 2 and 4
Because (Mkt price/EPS=PE ratio) lower EPS given Higher PE.
Lower EPS are because sh price under value.
Correct answer are 1 and 3.
No.5
4millio share issue with nominal value $0.5 per share
Dividend 24 cents per share has just been paid.
Four yr ago, the dividend was 20.51 cents per share.
Beta 0.5, risk free rate 3%, market premium 8%
what is the market capitalisation
Correct answer is $33,280,000
No.6
A co. Earning Yield of 12.5%
The average PE ration for similar companies is 9.5
which statement are regarding the value of shares in the company is true?
1-It is likely that share in the company are under value
2-It is impossible to comment on the value of share
3-It is likely that share in the company are fairly valued
4-It is likely that share in the company are over valued.
Correct Answer are 1
Pls explain to me about the question answer.
Thanks.
wish you have a nice weekend.
ACCA Forums
FMF9 MCQ question test
XYZ has share capital of 1,000,000 shares of $0.50 and $500,000 8% preference share, profit after tax of 30% is $ 420,00. what is the EPS?? sorry for asking such questions again
2.4*2.5= 6 but it is my lack of concentration while i was solving it, thanks a lot :)
11y ago#33You are welcome :-)
Hi All,
Just incase a tutor cannot help me with this the at moment could any of your explain the following?:
1) A company has sales of $200m per year. Receivable days are currently 40 days. Company are considering offering a 1% discount for payment within 15 days. 60% of customers are expected to take advantage of the discount. What is the effective annual cost of the discount? Answer: 15.8%....I have seen your working for this but keep on getting a different answer even when I am using brackets.
2) A company are considering investing in a new project which will cost $160,000 and have an expected life of 4 years and expected scrap value of $20,000. Anticipated net operating cash flows each year will be:
Year 1: $40,000
Year 2: $60,000
Year 3: $80,000
Year 4: $20,000
The cost of capital is 10%. What is the ARR? Answer: 16.67%
3) A company has 3 projects with the following initial costs and NPV's
Project A: $20,000 NPV: $2,000
Project B: $30,000 NPV $2,400
Project C: $10,000 NPV $1,200
Capital available for investment is $40,000. Projects are divisible. What is the max NPV? Answer: $4,000
4) A company has just paid a dividend of $0.23/share. Shareholders are expecting the dividend to remain at $0.23/share next year but to increase at an average rate of 3% per annum there after. Shareholders required return is 12% and the rate of corporation tax is 25%. What will be the current market value per share? Answer $2.56
Many Thanks,
David
11y ago#35I have just answered this in the Ask the Tutor Forum :-)
Thanks John.
11y ago#37You are welcome :-)
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