CFA Level 1 － Mock Exam 2 模拟真题－Q51-55 face, style, black, class

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51、Assume U.S. GAAP (generally accepted accounting principles) applies unless otherwise noted.
The year-end balances in a company's LIFO reserve were $56.8 million in the company's financial statements for both 2006 and 2007. For 2007, the measure that will most likely be the same regardless of whether the company used the LIFO or FIFO inventory method is the:

Select exactly 1 answer(s) from the following:

A. current ratio.

B. inventory turnover.

C. gross profit margin.

D. amount of working capital.

 

52、Assume U.S. GAAP (generally accepted accounting principles) applies unless otherwise noted.
An analyst gathered the following information about a company:

Shares of common stock	1,000,000
Net income for the year	$1,500,00
Par value of convertible bonds with a 4% coupon rate	$10,000,000
Par value of cumulative preferred stock with a 7% dividend rate	$2,000,000
Tax rate	30%

 The bonds were issued at par and can be converted into 300,000 common shares. All securities were outstanding for the entire year.
Diluted earnings per share for the company are closest to:

Select exactly 1 answer(s) from the following:

A. $1.05.

B. $1.26.

C. $1.36.

D. $1.43.

 

53、Assume U.S. GAAP (generally accepted accounting principles) applies unless otherwise noted.
At the beginning of the year, two companies issued debt with the same market rate, maturity date, and total face value. One company issued coupon-bearing bonds at par and the other company issued zero-coupon bonds. All other factors being equal for that year, compared with the company that issued par bonds, the company that issued zero-coupon debt will most likely overstate:

Select exactly 1 answer(s) from the following:

A. cash flow from operations but not interest expense.

B. interest expense but not cash flow from operations.

C. both cash flow from operations and interest expense.

D. neither cash flow from operations nor interest expense.

 

54、Assume U.S. GAAP (generally accepted accounting principles) applies unless otherwise noted.
An analyst would find information about significant uncertainties affecting a company's liquidity, capital resources and results of operations in the:

Select exactly 1 answer(s) from the following:

A. auditor's report.

B. notes to the financial statements.

C. balance sheet and income statement.

D. management discussion and analysis.

 

55、Assume U.S. GAAP (generally accepted accounting principles) applies unless otherwise noted.
When the financial statements materially depart from accounting standards and are not fairly presented, the audit opinion would be a(n):

Select exactly 1 answer(s) from the following:

A. limited opinion.

B. adverse opinion.

C. qualified opinion.

D. disclaimer of opinion.

 

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答案和详解如下：

51 Correct answer is C

“Analysis of Inventories,” Gerald I. White, AshwinpaulC. Sondhi, and Dov Fried
2008 Modular Level I, Vol. 3, pp. 320-325
Study Session 9-35-c, d
compare and contrast the effect of the different methods on cost of goods sold and inventory balances, and discuss how a company’s choice of inventory accounting method affects other financial items such as income cash flow, and working capital;
compare and contrast the effects of the choice of inventory method on profitability, liquidity, activity, and solvency ratios
The LIFO reserve did not change from 2006 to 2007. Without a change in the LIFO reserve, cost of goods sold would be the same under both methods. Sales are always the same for both, so gross profit margin would be the same in 2007. The FIFO inventory would be higher because the LIFO inventory and LIFO reserve are added to compute FIFO inventory. Because the inventory balances would be different under FIFO, the current ratio, inventory turnover, and net working capital would also be different under FIFO.

 

52 Correct answer is B

“Understanding the Income Statement,” Thomas R. Robinson, Hennie van Greuning, Elaine Henry, and MichaelA. Broihahn
2008 Modular Level I, Vol. 3, pp. 172-176
Study Session 8-32-h
describe the components of earnings per share and calculate a company’s earnings per share (both basic and diluted earnings per share) for both a simple and complex capital structure
Dividends of $140,000 (0.07 x 2,000,000) should be deducted from net income to derive amount available for common shareholders: $1,360,000 = (1,500,000 - 140,000). Basic EPS would be $1,360,000 / 1,000,000 or $1.36 per share. Diluted EPS would consider the convertible bonds if they were dilutive. Interest on the bonds would be $400,000 and the after-tax add back to net income would be $400,000 (0.7) or $280,000. Diluted EPS would be $1,640,000 / 1,300,000 shares assuming conversion = $1.26 per share.

 

53 Correct answer is A

“Analysis of Financing Liabilities,” Gerald I. White, AshwinpaulC. Sondhi, and Dov Fried
2008 Modular Level I, Vol. 3, pp. 466-475
Study Session 9-39-b, c
determine the effects of debt issuance and amortization of bond discounts and premiums on the financial statements and ratios;
analyze the effect on financial statements and financial ratios of issuing zero-coupon debt
When a company issues a zero-coupon bond, cash flow from operations is overstated over the life of the bond. Interest expense is recorded for income statements purposes, but is added back in the statement of cash flows as a non-cash adjustment to cash flow from operations.

 

54 Correct answer is D

“Financial Statement Analysis: An Introduction,” Thomas R. Robinson, Hennie van Greuning, Elaine Henry, and MichaelA. Broihahn
2008 Modular Level I, Vol. 3, p. 20
Study Session 7-29-c
discuss the importance of financial statement notes and supplementary information (including disclosures of accounting methods, estimates and assumptions) and management’s discussion and analysis
Management must highlight any favorable and unfavorable trends and identify significant events and uncertainties that affect the company’s liquidity, capital resources and results of operations in the MD&A.

 

55 Correct answer is B

“Financial Statement Analysis: An Introduction,” Thomas R. Robinson, Hennie van Greuning, Elaine Henry, and MichaelA. Broihahn
2008 Modular Level I, Vol. 3, p. 21
Study Session 7-29-d
discuss the objective of audits of financial statements, the types of audit reports, and the importance of effective internal controls
An adverse opinion occurs when the financial statements materially depart from accounting standards and are not fairly presented.

 

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