ACCA paper f9 financial management FInal mock examination acca f9 errata sheet

ERRATA SHEET ACCA F9 Financial Management, 08/09, Complete Text ISBN: 978-1-84710-524-0 Chapter Page 15 Error: Against ‘Evaluating proposed expansion plans’ (the fourth example), there should be a tick under Financial management Chapter Page 91 Error: $4m × 80% × 365 = 61 days $30m Correction: $4m × 365 = 61 days $30m × 80% Chapter Page 123 Error: Expandable text step No of re-orders pa – 3,1062 Correction: Expandable text step No of re-orders pa – 3,162 Chapter Page 149 Error: Saving is 63 days (dropping from 73 days to 10) and there are 365 ÷ = 5.794 periods in a year Correction: Saving is 63 days (dropping from 73 days to 10) and there are 365 ÷ 63 = 5.794 periods in a year Chapter Page 253 Error: a ROCE= Average annual profit $150,000 ×100 = × 100 = 33.33% Initial investment $800,000 b ROCE= $150,000 Average annual profit ×100 = × 100 = 18.75% $450,000 Average investment Correction: a ROCE= Average annual profit $150,000 ×100 = × 100 = 18.75% Initial investment $800,000 b ROCE= Average annual profit $150,000 ×100 = × 100 = 33.33% Average investment $450,000 Chapter 10 Page 269 Error: Step Discount the annuity as usual 200 × 4yr 5% AF = 200 × 3.456 = 709.2 Correction: Step Discount the annuity as usual 200 × 4yr 5% AF = 200 × 3.546 = 709.2 Page 274 Error: (Expandable text) Year 13% Correction: (Expandable text) Year 13% 13% 13% 11% 8% Chapter 11 Page 329 Error: Time T0 T1 T2 Net trading inflows Tax payable (30%) Initial investment Scrap proceeds Tax relief of WDAs Net cash flows DF @ 8% PV NPV Timing of tax relief (6,500) 19,500 1,950 T2 (4,875) 14,625 1,463 T3 $ 26,000 Initial investment WDA @ 25% Written down value WDA @ 25% Written down value Sales proceeds Time Tax saving @30% $ (12,500) T0 $ T1 $ 16,000 T2 $ 16,000 (4,800) T3 $ 16,000 (4,800) T4 $ (4,800) (26,000) 12,500 1,950 1,463 (26,000) 16,000 13,150 25,163 1.000 0.926 0.857 0.794 (26,000) 14,816 11,270 19,979 638 4,162 0.735 $16,268 Correction: Time T0 T2 T3 Time (26,000) 1.000 (26,000) Error: (TYU answer 1) (b) (i) 33 500 × 100 = 6/6% Correction: (TYU answer 1) (b) (i) This is a rise of: 33 500 × 100 = 6.6% Page 366 Error: (TYU answer 1) (b) (v) 33 91 × 100 = 3.6% Correction: (TYU answer 1) (b) (v) 33 91 × 100 = 36% 1,950 T2 (4,875) 14,625 1,463 T3 638 T4 T1 $ 16,000 T2 $ 16,000 (4,800) T3 $ 16,000 (4,800) 1,950 13,150 0.857 11,270 12,500 1,463 25,163 0.794 19,979 T4 $ (4,800) (26,000) Chapter 12 Page 365 This is a rise of: (6,500) 19,500 (12,500) 2,125 T0 $ Net trading inflows Tax payable (30%) Initial investment Scrap proceeds Tax relief of WDAs Net cash flows DF @ 8% PV NPV Timing of tax relief $ 26,000 Initial investment WDA @ 25% Written down value WDA @ 25% Written down value Sales proceeds Balancing allowance T1 Tax saving @30% $ 16,000 0.926 14,816 638 (4,162) 0.735 (3,059) $17,006 Chapter 18 Page 574 Error: 6 20 + + 7.5 × = 17.92% Correction: 7.5 20 Error: 7,500,000 8,300,000 20% 17.92% 800,000 8,300,000 7.5% 18.79 Correction: 7,500,000 800,000 ×20% + ×7.5% =18.79% 8,300,000 8,300,000 Page 587 Error: NPV= 150,000 = (431,624) 0.1404 – 1,150,000 Correction: 150,000 NPV= – 1,500,000 = (431,624) 0.1404 Page 589 Error: WACC = 21.6 × 8.71% + 14.6 21.6 = 11.29% Correction: WACC = 21.6 × 8.71% + 14.6 21.6 Chapter 19 Page 621 Error: (TYU 2) = 1.6 × 0.7 0.7 + 0.03 (1 – 0.30) Correction: (TYU 2) = 1.6 × 0.7 0.7 + 0.3 (1 – 0.3) Page 622 Error: (TYU 2) = Rf (1 – t) = 10% (1 – 0.30) = 7% Correction: (TYU 2) Kd = Rf (1 – t) = 10% (1 – 0.3) = 7% × 12.53% = 11.29% Page 623 Error: (TYU Step 2) 1.23 ì 1.23 0.6818 = òe Correction: (TYU Step 2) 0.88 1.23 ì òe = 0.6 = ße 1.80 Chapter 22 Page 701 Error/correction: ‘Here the rates quoted apply to a loan or deposit taken out for a month period.’ Should be “6 month period” Chapter 24 Page 763 Error: (Profit after tax × number of shares) (Total dividends × number of shares) Correction: (Profit after tax ÷ number of shares) (Total dividends ÷ number of shares) Page 771 Errror: Current ratio (840/409 and 508/274) Quick ratio (320/409 and 204/274) Correction: Current ratio (840/409 and 508/274) Quick ratio (320/409 and 204/274) 2.67 1.02 2.49 2.05 0.78 1.85 0.74