CMA Study Group

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  • 1.  McQ Query.

    Posted 11-28-2022 02:20 PM
       An example of a hedging approach to financing is a. increasing earnings by purchasing stock puts. b. matching assets with liabilities of the same maturity. c. financing building projects with accounts payable. d. using five-year bonds to finance inventory acquisition  
    Shouldn't  Option 'A' be the right answer.
    Option B is given as the right answer. Pls guide.









  • 2.  RE: McQ Query.

    Posted 11-29-2022 10:23 AM
    Purchasing put options don't guarantee increase in earnings however matching assets with liabilities of same maturities help you to cancel out the inherent risk. Hence B is the right answer.

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    Paul Thomas
    Student
    Hyderabad
    India
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  • 3.  RE: McQ Query.

    Posted 12-02-2022 12:22 AM
    I don't want CMA study groups So please don't send these type of mails.





  • 4.  RE: McQ Query.

    Posted 12-03-2022 04:44 AM
    The answer is D
    We need to rank the products to which product has a cheep cost in production and the hiest cost in parshassing.
    Use the defferent between cost of pushasing and VC of production as below:
    Produst A has VC 15 $ - purshase cost 21$ = 6 $ loss if purshasing
    Procust B has 34$ - 42$= 8$ loss if purshsed
    Product C is purshaing (given )
    So synergy should make as much as it can from product B becouse it has the more loss if purshased.
    Which is the all quantity needed 6000 q
    And the remain capacity for product B .

    Hope that helpe u.
    Regards.


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    Ahmed Hassan
    Accountant
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