June 10 Exams POLL Paper F9 was Post your comments here

development cost is sunk, therefore irrelevant,

financing cost (interest on bonds issued) should not have been included in NPV calculation, since it is included in our discount factor.

Please correct me if I am wrong?

The question stated that the project had already been undertaken didn’t it. I thought it did so I used real WACC as the interest on loan should already be in there shouldn’t it? If it was a proposal I think I should have used the discount factor in the form of loan interest rate and then the company would have to adjust the WACC. Depends on whether or not it was proposal. Mind is too fuzzy on the detail. F5 Monday!!!

Erm sorry I’m muddling up questions 2/3 in my mind lol. Re-editing my post.

Q3 was my best answered question in the exam ok:
development cost had to be deducted from the fixed overhead and had the balance multiplied by the inflation rate 6%.
Selling price increased every year by the inflation 3%.
Variable cost increased every year by inflation 4%,
Interest should not be included because it’s been taken into account in calculating the WACC
Depreciation not included non cash flow item,
Tax was one year in arrears.
Capital allowances on reducing balance basis and deduct the scrap at year 4 and multiply by tax rate,
include scrap in year 4 as cash will be received by end of project,
Discount rate in real discount rate x general inflation rate
That’s what I could remember I may not be right please correct me.

@rafa2302 said:
Hi everyone,a friend has found a link on the ACCA website which offers an examination feedback form on specific papers. If you feel that the paper was unjust and the examiners language unnecessarily complicated please complete the form. The examination board use these feedback forms when setting marking schemes, before exam results are published. it could result in a few extra marks if the board agrees – so definitely worthwhile.
The link is noted below:
https://www.accaglobal.com/allnews/students/2010/NEWSQ2/News/3331775

I will surely do and encourage everyone who felt the paper was unjust to do so.
Thanks

Many of you may disagree but I thought that the examiner had put in probability calculations for easy marks and am surprised that a lot of people are complaining about it as everyone who has posted their results for the probabilities has got the same results.

I thought the ‘sunk costs’ was a red herring and ignored it it is relevant to F5 and not F7. We wanted to know the NPV of the project, F7, not if we should continue it now it has been started, F5. Of course If I am wrong I will hopefully only miss out on 1 mark.
Either way, I will be resitting in December as my mind went totally blank on question 2 which was really annoying as it was the last thing I looked at before going into the exam and with 0/25 for that question its highly unlikely I will have got a pass.

https://www.accaglobal.com/allnews/students/2010/NEWSQ2/News/3331775
This link only lets you leave fed back for Dec 09 examination any comment?

I quite agree with the person who said “What the Hell” this is exactly how I felt when I saw question 1 & 4. The other two question wheren’t so bad. I could not for the life of me figure out question on for the 13 marks.

God help us all.

I would not say it was too hard…But I am very dissappointed with my personal performance on the exam. While preparing for F9, I was sure that I’d score above 80%, now I hope for 50%…

as far as i remember probability in period 2 of balance being negative was 20%, coz regardless of the outcome (even if there was positive flow it was insufficient to cover negative flow in period 2) in period 1 in 20% cases in period 2 balance wud have been negative. So we needed just state 20% probablility:)

counting expected values was easy, so i just missed the part with counting probability of balance becoming more than 2500 overdrawn

i dont know why everyone is jst stuck with those 13 marks perhaps if u have done the i think june 2009 or dec 2008 question on cash budget u can have a very well idea how to with cash budget .
i think the paper was easy but due to its unpredictably make it tough also the time constraint was their.
bu overall easy paper and examiner had done well being creative nt jst giving simple straight forward npv or wacc to calculate sory i hope best for everyone but its how i saw the paper

I can not say it is hard at all. If you go through the last 4 papers, you will find similar questions on every single question! Think I will pass :