Cima F2 Exam Questions

1. CIMA F2 - Advanced Financial Reporting exam in just 24 HOURS! 100% REAL EXAM QUESTIONSANSWERS CIMA F2 - Advanced FinancialReporting Buy Complete Questions Answers Filefrom http://www.certs4you.com/cima/f2-dumps.html 100% Exam Passing Guarantee & Money BackAssurance SampleQuestions

2. Question No1: Which TWO of the following statements about bonds and their issue aretrue? Credit rating agencies assign risk categories to bondissues. Bonds are a form of loan capital, traded on stockexchanges. Bonds are a risk-free form of investing because they will always berepaid. All bonds have the same terms and conditions when issued. A bond issue is never underwritten because the return is fixed andguaranteed. Answer: A, B Question No2: RS is a listed entity that has no subsidiaries although its Finance Director is also a director of TU, an unconnected entity. It is preparing its financial statements to 30 September20X6. Which of the following substantial transactions must be disclosed in these financial statements in accordance with IAS 24 Related PartyDisclosures? Pension payments made on behalf of the Managing Director ofRS. Purchase of production materials from TU at a discounted price to the current market value. Sale of finished goods to TU at normal selling price. Performance related bonus payments made to the office staff for theyear. Answer: A Question No3: ST acquired 75% of the 2 million $1 equity shares of CD on 1 January 20X3, when the retained earnings of CD were S3,550,000. CD has no other reserves. ST paid $5,600,000 for the shares in CD and the non-controlling interest was measured at its fair value of S1,400,000 at acquisition. At 1 January 20X3, the fair value of CD's net assets was equal to their carrying amount, with the exception of a building. This building had a fair value of $1,000,000 in excess of its carrying amount and a remaining useful life of 25 years on 1 January 20X3. At 31 December 20X5, the retained earnings of ST and CD were $8,500,000 and $5,250,000 respectively. What is the value of goodwill to be included in the consolidated statement of financial position of ST as at 31 December20X5? A. $450,000 B. $1,450,000 C. $950,000 D. $570,000 Answer:A

3. Question No4: An entity has declared a dividend of $0.12 a share. The cum dividend market price of one equity share is $1.40. Assuming a dividend growth rate of 7% a year, what is the entity's cost ofequity? A. 17.0% B. 8.6% C. 16.2% D. 9.4% Answer: A Question No5: LM granted 100 share options to each of its 400 employees on 1 January 20X7. The options will only vest if employees remain with LM for 3 years from the grant date. The fair value of each share option was $5 on 1 January 20X7. 20 employees left in the year to 31 December 20X7 and at that date it was estimated that a further 35 would leave over the following two years. Which of the following journal entries did LM process to account for the share options in the year to 31 December 20X7, in accordance with IFRS2 Share-basedPayments? Dr Profit or loss $57,500 ; Cr Other reserves within equity$57,500 Dr Profit or loss $57,500 ; Cr Liabilities$57,500 Dr Profit or loss $172,500 ; Cr Other reserves within equity$172,500 Dr Profit or loss $172,500 ; Cr Liabilities$172,500 Answer: A Question No6: HJ is currently in dispute with an employee, who is claiming $400,000 in a legal case against them. HJ's legal advisors have stated that it is probable that they will lose the case and will have to pay the amount claimed. Also, HJ are claiming $250,000 from a supplier of defective goods and the legal advisors have stated that it is probable that HJ will be successful in this claim. What is the correct accounting treatment for these two items in HJ's financial statements? Provide for the $400,000 potential outflow and disclose the $250,000 potentialinflow. Provide for the $400,000 potential outflow and recognise the $250,000 potential inflow. Disclose the $400,000 potential outflow and disclose the $250,000 potentialinflow. Disclose the $400,000 potential outflow and recognise the $250,000 potentialinflow. Answer:A

4. Question No7: AB acquired its subsidiary on 1 January 20X7 when the fair value of net assets was the same as book value with the exception of property, plant and equipment that had a fair value $500,000 higher than carrying value. These assets were assessed to have a remaining useful life of 5 years from the date of acquisition. What is the net consolidation adjustment to the property, plant and equipment balance at 31 December 20X9? Give your answer to the nearest whole number (in '$000s).$? Answer: 200000,200 Question No8: LM is preparing its consolidated financial statements for the year ended 30 April 20X5. During the year LM acquired 30% of the equity shares of AB giving it significant influence over AB. LM conducted ratio analysis comparing the financial performance of the group for 30 April 20X4 and 20X5. Which of the following ratios would not be comparable as a result of the acquisition ofAB? Operating profitmargin. Return on capitalemployed. Earnings pershare. Interestcover. Answer: C Question No9: How would KL account for its investment in MN in its consolidated financial statements for the year to 31 December20X9? Jointventure Jointarrangement Financialasset Subsidiary Answer:A

5. Question No10: • LM acquired 15% of the equity share capital of ST on 1 January 20X6 for $18 million. LM acquired a further 50% of the equity share capital of ST for $50 million on 1 January 20X7 when the fair value of ST's net assets was $82 million. The original 15% investment in ST had a fair value of $20 million at 1 January 20X7. The non controlling interest in ST was measured at its fair value of $30 million at the date control in ST was acquired. Calculate the goodwill arising on the acquisition of ST that LM included in its consolidated financial statements at 31 December 20X7. Give your answer to the nearest $ million. $ ?million • Answer: 18,18000000 • Buy Complete Questions Answers Filefrom • PDF Version + Test Engine SoftwareVersion • 90 Days Free UpdatesService • Valid for AllCountries http://www.certs4you.com/cima/f2-dumps.html