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- November 27, 2019 at 2:19 pm
If the question 1 asks us to write about the assumption and methods used . how we should write to obtain maximum marks ?
For example if the question says-
PAT will increase by 3 % next year . And use PE to estimate value .
1) P.E and profit after tax are used to eat the value of the entity
1)It’s is assumed that PAT after tax will grow by 3 % and such growth can be determined with accuracy
2) P.E can be determined with accuracy.
Kindly guide me over this.
And I want to know if suppose the above example is of 6 marks then how can we break up between marks on appendix and marks on reportNovember 27, 2019 at 3:08 pm
You are asking me an impossible question because it really depends on the whole question and the exact wording of the requirements.
As far as the assumptions you have stated, you would normally be expected to explain why the growth cannot be estimated with accuracy, how you would go about determining a reasonable PE to use, and what other methods might we might in practice want to use.
With regard to breaking up the marks, again it depends too much on the actual question. Look at the marking schemes provided by the examiner (on the last page of all the exam answers) and you will see how the marks are being allocated.
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