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Free CIMA CIMAPRO19-F03-1-ENG Exam Questions

Try our Free Demo Practice Tests for Comprehensive CIMAPRO19-F03-1-ENG Exam Preparation

  • CIMA CIMAPRO19-F03-1-ENG Exam Questions
  • Provided By: CIMA
  • Exam: F3 Financial Strategy
  • Certification: CIMA Professional Qualification
  • Total Questions: 305
  • Updated On: Sep 28, 2024
  • Rated: 4.9 |
  • Online Users: 610
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  • Question 1
    • A company based in Country D, whose currency is the D$, has an objective of maintaining an operating profit
      margin of at least 10?ch year.
      Relevant data:
       • The company makes sales to Country E whose currency is the E$. It also makes sales to Country F whose
      currency is the F$.
       • All purchases are from Country G whose currency is the G$.
       • The settlement of all transactions is in the currency of the customer or supplier.
      Which of the following changes would be most likely to help the company achieve its objective?

      Answer: C
  • Question 2
    • A company has:
       • 10 million $1 ordinary shares in issue
       • A current share price of $5.00 a share
       • A WACC of 15%
      The company holds $10 million in cash. No interest is earned on this cash.
      It will invest this in a project with an expected NPV of $4 million.
      In a semi-strong efficient stock market, which of the following is the most likely share price immediately after
      the announcement of the new investment?

      Answer: A
  • Question 3
    • Company J is in negotiations to acquire Company K and believes it can turn around Company K's
      performance to match its own.
      The following information is available for the two companies:


      27


      Select the maximum price for each share that Company J should place on Company K during negotiations.  

      Answer: C
  • Question 4
    • A company has:
       • $6 million market value of equity
      • $4 million market value of debt
       • WACC of 11.04%
       • Corporate income tax rate of 20%
      According to Modigliani and Miller's theory of capital structure with tax, what is the ungeared cost of equity?

      Answer: A
  • Question 5
    • A company has a covenant on its 5% long term corporate bond.
       • Covenant - The earnings must not fall below $7 million
      The bond has a nominal value of $60 million.
      It is currently trading at 80% of its nominal value.
      The projected earnings before interest and taxation for next year are $11.5 million.
      The company retains 80% of its earnings. It pays tax at 20%.
      Advise the Board of Directors which of the following covenant conditions will apply next year?


      Answer: C
PAGE: 1 - 61
   
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