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CIMAPRA19-F03-1 Exam - Topic 7 Question 24 Discussion

Actual exam question for CIMA's CIMAPRA19-F03-1 exam
Question #: 24
Topic #: 7
[All CIMAPRA19-F03-1 Questions]

An all equity financed company reported earnings for the year ending 31 December 20X1 of $5 million.

One of its financial objectives is to increase earnings by 5% eachyear.

In the year ending 31 December 20X2 itfinanced a project byissuing a bondwith a $1 million nominal value and a coupon rate of 7%.

Thecompany payscorporate income taxat30%.

If the company is to achieve its earnings target for the year ending 31 December 20X2, what is the minimum operating profit (profit before interest and tax) that it must achieve?

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Suggested Answer: C

by Mollie at May 05, 2022, 10:07 AM

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Tijuana
4 months ago
Don't forget the tax impact on those earnings!
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Ines
4 months ago
Definitely need at least $7.57 million to cover the interest.
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Markus
4 months ago
Wait, how does a bond affect earnings like that?
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Izetta
4 months ago
I think it’s higher than that, maybe $7.50 million?
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Maryann
5 months ago
The earnings target is $5.25 million for 20X2.
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Raylene
5 months ago
I think this one is pretty straightforward. Cloud Security Posture Management would need to integrate with IAM account credentials to access the cloud accounts.
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Rosalind
5 months ago
Okay, let's see here. The question is specifically asking about a business rule that creates a CI from a Vulnerable Item record, so I'm going to eliminate the options that don't mention that directly. That leaves me with A and D, and D seems to be the more specific and relevant answer.
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Tammara
5 months ago
I'm feeling pretty confident about this one. Based on the information provided, I think the issue is most likely related to the zoning configuration. I'll double-check that first.
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Barbra
5 months ago
Monitoring high-risk areas seems like it could be relevant, but I'm not sure if that's the BEST approach for communicating results. I'll have to weigh the other options as well.
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Carole
5 months ago
I think the answer is factorial experiment. We practiced a question similar to this where both factors were considered fully.
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