AAFM CWM_LEVEL_2 Exam - Topic 7 Question 32 Discussion

Actual exam question for AAFM's CWM_LEVEL_2 exam

Question #: 32
Topic #: 7

S1213

Read the senario and answer to the question.

Mahesh's company has made plans for the next year. It is estimated that the company will employ total assets of Rs. 1000 lakh: 50% of the assets being financed by borrowed capital at an interest cost of 8% per year. The direct costs are estimated at Rs. 500 lakh. All other operating expenses are estimated at Rs. 76 lakh. The good will be sold to customer at 140% of the direct costs. Income tax rate is assumed to be 30%. Calculate net profit margin and return on owners' equity.

A8.4% & 11.78%

B9.4% & 8.88%

C8.4% & 6.88%

D6.4% & 8.88%

Show Suggested Answer

Suggested Answer: A

by Kate at May 05, 2022, 10:40 PM

Limited Time Offer

25%

Off

Get Premium CWM_LEVEL_2 Questions as Interactive Web-Based Practice Test or PDF

Contribute your Thoughts:

Submit Cancel

Darci

24 days ago

Wait, how does the tax rate affect the net profit margin?

upvoted 0 times

...

Merrilee

29 days ago

140% markup on direct costs? That seems high!

upvoted 0 times

...

Trinidad

1 month ago

I think option A is the right answer.

upvoted 0 times

...

Catalina

1 month ago

Looks like the assets are Rs. 1000 lakh, half borrowed!

upvoted 0 times

...

Joni

2 months ago

}

upvoted 0 times

...

Yuette

2 months ago

"I think I recall that if we factor in the tax rate correctly, it should help narrow down the options. I hope I can remember the exact formulas during the exam."

upvoted 0 times

...

Kip

2 months ago

"Candidate D",

upvoted 0 times

...

Vanesa

2 months ago

{

upvoted 0 times

...

Carin

2 months ago

upvoted 0 times

...

Yuette

2 months ago

"Was it the profit margin that we calculated with sales price minus total costs? I have a vague memory of a practice question with roughly the same figures."

upvoted 0 times

...

Kip

3 months ago

"Candidate C",

upvoted 0 times

...

Adell

3 months ago

I disagree, B seems more accurate to me.

upvoted 0 times

...

Isabelle

3 months ago

]

upvoted 0 times

...

Ozell

3 months ago

{

upvoted 0 times

...

Mila

3 months ago

upvoted 0 times

...

Yuette

4 months ago

"I feel like the calculations should lead me to one of the percentages mentioned. The interest cost is key here, I just need to be sure about the formulas."

upvoted 0 times

...

Kip

4 months ago

"Candidate B",

upvoted 0 times

...

Matthew

4 months ago

{

upvoted 0 times

...

Charlene

4 months ago

upvoted 0 times

...

Yuette

4 months ago

"I think I remember calculating net profit margin in class, but I'm not sure about the return on equity part. Did we use a similar example for calculating margins?"

upvoted 0 times

...

Kip

5 months ago

"Candidate A",

upvoted 0 times

...

Kanisha

5 months ago

{

upvoted 0 times

...

Kenneth

5 months ago

[

upvoted 0 times

...

Ahmed

5 months ago

{

upvoted 0 times

...

Georgeanna

5 months ago

I'm a little confused by the wording of this question. Is it asking about configuring Agent Client Collector itself, or is it asking about configuring something else to work with Agent Client Collector? I'll have to re-read the question a few times to make sure I understand it properly.

upvoted 0 times

...

Stefania

5 months ago

Hmm, I'm not totally sure about this one. The options seem pretty similar, and I'm not 100% confident in my understanding of how cloud environments impact risk. I might need to think this through a bit more.

upvoted 0 times

...