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| Section | Weight | Objectives |
|---|---|---|
| Topic 1: Managing Cash and Working Capital | 25% | - Cash and working capital management
|
| Topic 2: Regulatory Environment of Financial Reporting | 10% | - Regulators and their role
|
| Topic 3: Principles of Taxation | 20% | - Taxation fundamentals
|
| Topic 4: Financial Statements | 45% | - Statement preparation and IFRS application
|
MN recently took out a 5 year term loan to buy raw materials to take advantage of a supplier's bulk discount that had been offered to them.
What approach to financing working capital has MN undertaken?
Correct Answer: D 🗳️
Company Y is using some of the money from a share issue to purchase a new office building. The company is also using some of the money to purchase inventories. Which method of financing is this?
Correct Answer: A 🗳️
AB has prepared its financial statements for the year ended 31 July 20X5. On 15 September 20X5 a major fraud was uncovered by the external auditors which had taken place during the year to 31 July 20X5 The financial statements have not yet been authorised In accordance with IAS 10 Events After the Reporting Period, AB should treat the fraud as:
Correct Answer:
Pending
Country X charges corporate income tax at the rate of 20% on all income irrespective of whether it is paid out as a dividend. Country Y charges corporate income tax at the rate of 25% on all income.
An entity, AA, which is resident in Country X pays a dividend of $100,000 to another entity, BB, which is resident in Country Y.
Countries X and Y have a double taxation treaty which adopts the exemption method in respect of this type of transaction.
What is BB's liability to tax in Country Y in respect of the dividend income received?
Correct Answer: B 🗳️
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