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 1 Page 15
Error:

Against ‘Evaluating proposed expansion plans’ (the fourth example), there should be a tick under Financial
management.
Chapter 5 Page 91
Error:
$4m
× 80% × 365 = 61 days
$30m
Correction:
$4m
× 365 = 61 days
$30m × 80%
Chapter 6 Page 123
Error: Expandable text step 2
No. of re-orders pa – 3,1062
Correction: Expandable text step 2
No. of re-orders pa – 3,162
Chapter 7 Page 149
Error:
Saving is 63 days (dropping from 73 days to 10) and there are 365 ÷ 3 = 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 9 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 1. Discount the annuity as usual
200 × 4yr 5% AF = 200 × 3.456 = 709.2
Correction:
Step 1. 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:
5

1

6

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 =

7
21.6

× 8.71% +

14.6
21.6

= 11.29%

Correction:
WACC =

7
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 2 Step 2)
1.23 ×

1.23
0.6818

= ße

Correction: (TYU 2 Step 2)
0.88

1.23 ×
ße =

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 3 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
1

2.05
0.78

1.85
0.74