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The answer is incorrect. It’s $125000.

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Well, the answer I have done and the answer in the kit is entirely different. And I don’t understand a thing in the kit

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Well, i have already typed the whole question. It’s in kaplan kit – Old edition (Until June 2017).

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Well, i have already typed the whole question

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Kaplan Kit – B Chemicals

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But there is no mention of inflation rates of either country , so how do we know that the euro is appreciated against dollar?

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Thanks 🙂

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Thanks 🙂

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K.
There is a doubt regarding Arwin Co. Do i have to use all the possible methods to find the ratios

For example , Financial risk can be measured using Debt/equity and capital gearing.
So, Do i have to show the workings of both these methods?

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There are question in the kit for calculating spread.

Spread = 3(3/4*Transaction cost *variance of cashflows/Int rate)^1/3

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Well , yeah, Spread is not part of this question. I jaz want to know how do i calculate spread in the calculator using the formula given in the kit ( long formula) becoz most of the times it doesn’t show a correct value ?

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Thanks sir ! 🙂

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Thank you! 🙂

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I will tell u an example so that you can better understand my problem. For example , if the final answer is ,let’s say, $34567 and question specifies to answer in the nearest $000 s, the kit answer sometimes will be $34000 or $35000. So, I will choose $35000 right?

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The first one I saw it in one of the answers in the kit for the question ‘ Which of the following is most likely to increase the working capital’. Can you explain how working capital increase when non current assets are sold?

In the 2nd question, my doubt is , in the kit the ordering cost is calculated as usual and then adding 10% of purchase price.. I didn’t get that part.

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No , I didn’t . I went for offline class.. I find some questions in BPP really hard to crack which are those I mentioned here . Even I try to grasp the solution , but I still don’t understand 🙁

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hmmm..thanks 🙂

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The answer for 1st answer is 15%

In the kit, gearing is calculated as (4000*1.05)+ 6200+(2000*0.8)/(8000*2*5)= 12,000/80,000 = 15%
I know already what you have said , but i didn’t get why they multiply it by 2 in the denominator..?

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Yeah . Thanks 🙂

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1. I didn’t understand how
Break even point= $20,000=500 * (selling price – $20)

2. In this case, I didn’t understand how C/S ratio is calculated and how we arrive to the final
answer (i.e. the total sales to achieve break even)

3. I didn’t understand how to calculate variable costs

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OK , thanks !! 🙂

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Thank you ! 🙂

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Thanks a lot ! Now I feel relieved 🙂

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I didn’t understand why you have multiplied the original 10% market share with 285000 units ? Another question that I have for you is could you tell me how market share and size differ from each other , or are they related in some way .

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Well, for the second question I had checked with different numbers ie current assets = $50,
Current liabilities = $ 20 , cash = $10, Current assets excluding inventory = $ 40

Quick ratio = $40 – $10/ $ 20 – $10 = $30/ $10 = 3
So in my numbers quick ratio has increased ?

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