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Hi,
On this question for gearing I included the 500 for retained earning for the total equity.
Why shouldn’t you be using this in the total equity calculation?
Thanks
Also the questions says calculate market values. So when you answer the question do you only sum up the market values only and not to sum up the values which are book values?
The market value of equity includes any retained earnings – it is the most likely reason for the market value being more than the book value!
If the question asks for market values, then it means market values (not book values).
Why have you not watched my free lectures? They are a complete course for Paper F9 and cover everything need to be able to pass the exam well 🙂
Thank you for the help. I have watched it but there are some questions which are confusing due to the wordings.
for example for Q17 MCQ on Dec 2014 paper
They have included Loan – 6200 in the calculation for debt. Why do you include this in the calculation if the question states market value?
Thanks
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