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CIMAPRA19-F03-1 Exam - Topic 3 Question 60 Discussion
CIMAPRA19-F03-1 Exam - Topic 3 Question 60 Discussion
Actual exam question for CIMA's CIMAPRA19-F03-1 exam
Question #: 60
Topic #: 3
[All CIMAPRA19-F03-1 Questions]
Which TWO of the following statements about debt instruments are correct?
A
A zero coupon will eliminate the tax shield effect on debt payments.
B
Changes in corporation tax rates will have no effect on the tax shield of fixed rate debentures.
C
The true cost of servicing debt instruments to the company is the post-tax cost of debt.
D
If corporation tax rates rise, the tax shield effect on debenture interest will be reduced.
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Suggested Answer:
A, B
by
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at
Nov 18, 2022, 08:11 AM
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Jani
4 months ago
A zero coupon doesn't eliminate the tax shield, just changes it.
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Leonor
4 months ago
Changes in tax rates won't affect fixed rate debentures, that's a fact!
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Whitley
4 months ago
Wait, if tax rates rise, how does that reduce the tax shield? Sounds off.
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Shay
4 months ago
I disagree, tax shields can still apply to zero coupons.
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Lilli
4 months ago
The post-tax cost of debt is definitely the true cost!
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Natalya
5 months ago
I thought if corporation tax rates rise, the tax shield would actually increase, not reduce, so I'm a bit confused about that statement.
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Avery
5 months ago
The post-tax cost of debt seems right to me as the true cost, but I can't recall if it applies to all debt instruments equally.
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Alison
5 months ago
I think changes in corporation tax rates do affect the tax shield, especially for fixed rate debentures, but I need to double-check that.
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Novella
5 months ago
I remember discussing how zero coupon bonds work, but I'm not sure if they really eliminate the tax shield effect.
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Lashaunda
5 months ago
I'm pretty confident that the answer is D. Master-detail relationships allow for the parent record to be deleted and have all child records deleted as well, which is exactly what the question is asking for.
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Altha
5 months ago
I'm pretty sure Firewall as a Service (FWaaS) is one of the Prisma Access security services, so I'll go with option B.
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Roosevelt
5 months ago
Alright, I got this. The key is to generate a new SSH key pair and add the private key to the instance. Option C is the way to go.
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Jani
4 months agoLeonor
4 months agoWhitley
4 months agoShay
4 months agoLilli
4 months agoNatalya
5 months agoAvery
5 months agoAlison
5 months agoNovella
5 months agoLashaunda
5 months agoAltha
5 months agoRoosevelt
5 months ago