• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
Free ACCA & CIMA online courses from OpenTuition

Free ACCA & CIMA online courses from OpenTuition

Free Notes, Lectures, Tests and Forums for ACCA and CIMA exams

  • ACCA
  • CIMA
  • FIA
  • OBU
  • Books
  • Forums
  • Search
  • Register
  • Login
  • ACCA Forums
  • Ask ACCA Tutor
  • CIMA Forums
  • Ask CIMA Tutor
  • FIA
  • OBU
  • Buy/Sell Books
  • All Forums
  • Latest Topics

ACCA December 2022 Exam results:
* Pass rates * Comments * Instant Poll * Competition *

Specially for OpenTuition students: 20% off BPP Books for ACCA & CIMA exams – Get your BPP Discount Code >>

Help pls

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FM Exams › Help pls

  • This topic has 1 reply, 2 voices, and was last updated 7 years ago by John Moffat.
Viewing 2 posts - 1 through 2 (of 2 total)
  • Author
    Posts
  • December 4, 2015 at 2:02 pm #287530
    kasia
    Member
    • Topics: 24
    • Replies: 17
    • ☆

    Dear John,

    Could you please help me with the below question, I would not have a clue what to write if this came up in the exam.

    ‘Assume that the loan notes have recently been issued specifically to fund the companies expansion programme under which a number of projects are being considered. It has been suggested at a project appraisal meeting that because these projects are to be financed by the loan notes, the cutoff rate for project acceptance should be the after tax interest rate on the loan notes rather than the WACC. Discuss this suggestion.

    December 4, 2015 at 3:03 pm #287562
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 51532
    • ☆☆☆☆☆

    But I explain this very point in the lecture that go with chapters 18 and 19 (following on from 17).

    Are you not watching the lectures (because I really cannot be expected to type them all out here!!).

    He is wrong, because increasing the gearing would cause the cost of equity to increase.

    Depending on how many marks were given for it, you could then go on to discuss the different theories of gearing (which again are all covered in detail in the lectures).

  • Author
    Posts
Viewing 2 posts - 1 through 2 (of 2 total)
  • You must be logged in to reply to this topic.
Log In

Primary Sidebar

ACCA News:

 

ACCA My Exam Performance for non-variant Applied Skills exams is available NOW

NEW! Download the ACCA Pass Guide

FREE Verifiable CPD for ACCA Members

ACCA mock exams and debrief videos

ACCA Options:  “Read the Mind of the Marker” articles

Subscribe to ACCA’s Student Accountant Direct

Donate

If you have benefited from OpenTuition please donate.

ACCA CBE 2023 Exams

Instant Poll * How was your exam, and what was the result?

BT CBE exam was.. | MA CBE exam was..
FA CBE exam was.. | LW CBE exam was..

Specially for OpenTuition students

20% off BPP Books

Get BPP Discount Code

Latest comments

  • John Moffat on Capital asset pricing model (part b) – ACCA Financial Management (FM)
  • John Moffat on Capital asset pricing model (part b) – ACCA Financial Management (FM)
  • palbu on Basic group structures – Impairment – ACCA (SBR) lectures
  • AkilaShaikh on Capital asset pricing model (part b) – ACCA Financial Management (FM)
  • AkilaShaikh on Capital asset pricing model (part b) – ACCA Financial Management (FM)

Copyright © 2023 · Support · Contact · Advertising · OpenLicense · About · Sitemap · Comments · Log in


We use cookies to show you relevant advertising, find out more: Privacy Policy · Cookie Policy