Cima F2 past exam papers

8/20/2019 Cima F2 past exam papers

http://slidepdf.com/reader/full/cima-f2-past-exam-papers 1/18



F2 extends the scope of the F1 Financial Management exam.

It looks at advanced topics in financial accounting the preparation of full consolidated financialstatements and complex issues of principle in

accounting standards.

Pass Cima F2 Exam By



How CIMA benefit your business

Analysis - Understanding the history behind numbers and use it to m

business decisions

Strategy – Using the insight from analysis to help formulate businessstrategy to create wealth and shareholder value.

Risk - The application of analytical skills to observe business processesend a pair identify and manage risks.

Planning – using accounting techniques to plan and budget.

Communication – knowing what information management needs

and explaining the numbers to non-financial managers.

Pass Cima F2 Advanced Financial Reporting Exam By The Help Of Exams4Sure Get Complete http://www.exams4sure.com/CIMA/F2-

practice-exam-dumps.html

http://www.exams4sure.com/CIMA/F2-practice-exam-dumps.html





Pass exam by the help of








The Sig

CIMA F2Financial Management

Questions & Answers








Why Choose Us

Quality and Value 100% Guarantee to Pass Exam Answers Verified by Experts Based on Real Exam Scenarios 3500+ Exams Dumps 24/7 Customer Support on Mail and Live Chat

100% Lowest Price Guarantee








When can WACC be used as a discount rate?

The WACC is often used as a discount rate when using net presinternal rate of return calculations. However, this is only approprfollowing conditions are met:(1) The capital structure is constant. If the capital structure chanweightings in the WACC will also change.

(2) The new investment does not carry a different business risk pexisting entity's operations.(3) The new investment is marginal to the entity. If we are only losmall investment then we would not expect any of ke, kd or thechange materially. If the investment is substantial it will usually cvalues to change.

Question No 1:





Formula - given in the assessment WACC?

k0=ke(Ve/(Ve+Vd))+kd(Vd(Ve+Vd))

Question No 2:





Procedure for calculating the WACC?

Step 1 Calculate weights for each source of capital.Step 2 Estimate the cost of each source of capital.Step 3 Multiply the proportion of the total of each source of capcost of that source of capital.Step 4 Sum the results of step 3 to give the weighted average c

Question No 3:





Weighted Average Cost of Capital (WACC)?

The weighted average cost of capital (WACC) is the average centity's finance (equity, bonds, bank loans, and preference shaaccording to the proportion each element bears to the total po

Question No 4:





kd for redeemable bonds?

The kd for redeemable bonds is given by the IRR of the relevant cash flows.The relevant cash flows would be (assuming that there is no one year delay isaving):Year Cash flow0 Market value of the bond (or nominal value if being issued or is trading at p1 to n Annual interest payments net of tax i(1 - T)

n Redemption value of the bond RV

There are four steps to ensuring an accurate computation:(1) Identify the cash flows. Note that the interest payments should be includewhen calculating the cost of debt for bonds from the viewpoint of the issuernot deducted when calculating the return to the investor.(2) Estimate the IRR.

(3) Calculate two NPVs (preferably one -ve and one +ve).(4) Calculate the IRR.

Question No 5:





Kd for bank borrowings?

The cost of debt for bank borrowings is simply kd = r (1 - T)where: r = annual interest rate in percentage termsT = corporate tax rate

Question No 6:





The cost of debt - kd Features?

(1) Debt is tax deductible and hence interest payments are ma(2) Debt is always quoted in $100 nominal units or blocks.(3) Interest paid on the debt is stated as a percentage of nominis known as the coupon rate. It is not the same as the cost of deamount of interest payable on the debt is fixed. The interest is c

the coupon rate multiplied by the nominal value of the debt.(4) Debt is normally redeemable at par (nominal value) or at a discount.(5) Interest can be either fixed or floating (variable) on borrowinnormally pay fixed rate interest.

Question No 7:





The cost of debt - kd?

The cost of debt is the rate of return that debt providers require that they provide.The value of debt is assumed to be the present value of its futur

Question No 8:





The dividend valuation model with constant growth?

ke =(d1/P0)+g or ke =(d0(1+g)/P0)+gwhere g = a constant rate of growth in dividendsd1 = dividend to be paid in one year's timed0 = current dividend

Question No 9:





Cum div and ex div share prices?

The ex dividend ('ex div') value of a share is the value just after ahas been paid. Occasionally in questions, you may be given a s just before the payment of a dividend (a 'cum div' price). In thisvalue of the upcoming dividend should be deducted from the to give the ex div price.

For example, if a dividend of 20 cents is due to be paid on a shaa cum div value of $3.45, the ex div share price to be entered informula is $3.45 - $0.20 = $3.25.

Question No 10:





Get your money back if yo

100% Exam Passing GuaranWith Money Back Assuranc

To Get Comple



Documents

Cima F2 past exam papers