*** June 2022 ACCA FM exam – Instant Poll and comments ***

hey guys so for fm the qs for eps was it 0.388 or smth ? and for overtrading qs was it lowers the ratio from last year but still above industry average? and for wc days i got 65 i think,and for one of the matching qs in sec a for converting agressive to matching i did profitability decreases long term finance increases short term decreases and receivables and idv does not change or smth,and for the sec c WACC i got 11.4% or smth ..if anyone remembers answers lmk

My section C was the following 2:

I/ was NPV and ROCE investment appraisal, give comment on that, and discussing uncertainty vs risk. This was a reasonable one and I expect good things.

II/ was EOQ, cash operating days, and why hold on to cash

I think I did EOQ okay except I forgot to divide Cost of Holding by 2, that would hurt.

For section B I think my answer included:

6.49% for WACC – I used Market Value, 3.8% for k(debt) after tax, as it’s irredeemable and therefore a perpetuity. I forgot what I got for equity

There was one where the M.V was 106.xx

The theory questions absolutely brutalized me, I didnt study theory at all so I just make random guesses, but I think I did alright on the computational

Which sources of finance SMES are restricted from

Did anyone get a WACC calc for their first question on section C? My cost of debt was actually negative, the post-tax interest payments were something like 8% over only 3 years. That, plus convertibles, less MV was actually negative? And my IRR was really low? I don’t know what I did wrong but I’ve never seen a negative total before? My overall WACC was 11% I think

did anyone got sec B question from interest rate ….

What about merits of NPV and IRR?

cost of equity was 0.85(1+0.06)/5.55 + 0.06 which I got as 22.24%. Its pretty high compared to usual but thats what I got. 10 marker wacc

I got this too. Just tried to write whatever I could remember about the positives and negatives of NPV and IRR

Section C, cost of equity i got 22% cost of debt 3.8% and also bank 3% then wacc as 15.8% ,i also got npv as something starting with positive 55….
Who got the same?

In npv questions do we need to remove that 100m and 50m cost

I got NPV of £2k and ARR 39% so said both should be accepted (section C) I had a EOQ question and said if discount was offered then that should be taken ahead of the EOQ did anyone get these?

For section C
I got an NPV Question and ROCE and computer ARR and it said to discuss the acceptability of the project.
I got a positive NPV and the ARR i think i got 38.8%
It then asked me to talk about risk and uncertainty linking proabiltiy analysis and payback period
I mentioned that risk assign probabilty whereas uncertainty does not. Moreover that the increase in risk depends on the volatility and uncertaInty depends on the project life.
It also had a question on EOQ and bulk discount discount
I got a net saving
EOQ=6000
AHC=720
AOC=720

For bulk i do not remember but obviously the Q and the price had to change and everything else was fine

Then i had to discuss the cash holding and factiors of lenght of operating cycle