Information from the financial statements of RST for the year ended 30 April 20X9 is as follows:
At 30 April 20X9 the ordinary shares are trading at $4.75.
What is the price earnings (P/E) ratio for RST at 30 April 20X9?
A. 15.83
B. 7.92
C. 10.56
D. 9.31
AB and CD are competitors supplying components to the car manufacturing industry. AB operates in Country X and CD operates in Country Y. Both entities were incorporated on the same day, are the same size and prepare financial
statements to 31 March each year using international accounting standards.
Which of the following statements taken individually would limit the usefulness of the comparison of the return on capital employed ratio between the two entities?
A. The corporate tax rate is 25% in Country X and 40% in Country Y.
B. The average rate of inflation is 3% in Country X and 10% in Country Y.
C. The average rate of borrowing is 2% in Country X and 7% in Country Y.
D. The currency is Dollar in Country X and Krona in Country Y.
When accounting for a finance lease under IAS 17 Leases, which TWO of the following are recognised in the statement of profit or loss?
A. Finance cost element of the lease payments
B. Depreciation of the leased asset
C. Lease payments paid
D. Lease payments payable
E. Capital repayment element of the lease payments
FG and RS operate in the same retail sector within the same country and are of a similar size. The following ratios have been calculated based on the financial statements for the year ended 30 September 20X4:
Which of the following factors would limit the usefulness of these ratios as a basis for assessing the comparative performances of FG and RS?
A. RS has a higher level of borrowings and associated finance costs.
B. RS sold a piece of land for a sum much greater than its carrying value.
C. RS operates at the low margin end of the market whilst FG operates at the high margin end.
D. FG has a higher level of deferred tax liabilities than RS.
As at 31 October 20X7 TU's financial statements show the entity having profit after tax of $600,000 and 900,000 $1 ordinary shares in issue. There have been no issues of shares during the year. At 31 October 20X7 TU have 300,000 share options in issue, which allow the holders to purchase ordinary shares at $2 a share in 3 years' time. The average price of the ordinary shares throughout the year was $5 a share.
What is the diluted earnings per share for the year ended 31 October 20X7?
A. 66.7 cents
B. 58.8 cents
C. 50.0 cents
D. 55.6 cents
Which of the following is a related party according to the definition of a related party in IAS24 Related Party Disclosures?
A. Major customer
B. Provider of finance
C. Managing Director
D. Major supplier
JK has calculated its inventory holding period:
Which THREE of the following would have contributed to the above movement in inventory holding period?
A. JK's main supplier offered a significant one-off discount for purchases made in March 20X8.
B. In January 20X8 a major competitor entered the market in which JK operates.
C. A substantial contract is due to be dispatched early in April 20X8.
D. JK is enforcing stringent inventory control techniques following management instructions.
E. JK suffered industrial action by its production staff in the period December 20X7 to February 20X8.
F. It has been difficult to obtain one of JK's main components due to import issues with its overseas supplier.
KL issued $100,000 of 6% convertible debentures at par on 1 January 20X7. These debentures are redeemable at par or can be converted into 5 shares for each $100 of nominal value of debentures on 31 December 20X9.
The share price on 1 January 20X7 is $18 a share. The share price is expected to grow at a rate of 7% a year.
The expected redemption value for each $100 nominal value of debentures on the date of conversion is:
A. $110.25
B. $103.04
C. $100.00
D. $90.00
CORRECT TEXT
LK acquired 100% of the equity shares of TU on 1 January 20X4. LK disposed of 60% of TU for ?,400,000 on 30 September 20X4. The sale proceeds reflected the fair value of TU's shares on that date.
The remaining 40% shareholding gave LK the ability to exercise significant influence over the activities of TU. TU reported profit of $1,800,000 for the year ended 31 December 20X4 and this accrued evenly throughout the year.
Calculate the investment in associate that will be presented in LK's consolidated statement of financial position as at 31 December 20X4.
Give your answer to the nearest whole $'000.
$ 000
A. 1780, 1780000
CORRECT TEXT
FG's statement of profit or loss account for year ended 31 December 20X1 is:
What is the operating profit margin for FG for the year ended 31 December 20X1?
Give your answer to the nearest whole %.
? %
A. 14
