I just got screwed in Sample I. I got 63% Ethics - 83.3% Quant - 33.3% FSA - 50% ( My fav, supposed to be strong) Equity - 100% AI - 50% Corp Fin - 66.67%
learn from your mistakes - understand what you did wrong - you may only need high 60’s to pass…
The results are skewed since it isn’t a full length exam. You can throw your AI and Quant scores out, since they’re probably going to be 1 item set Spend some more time on FRA.
I believe there was only 1 set item for FRA, so overall not a great sample size. I believe I scored 2/6 on that set and scored approx 91% in FRA on the CFAi mock. Don’t worry too much, just review the reading which the FRA item set focused on… I believe it was SS7 and the effects of capitalizing/expensing.
One thing I realized doing this sample, FRA could be really hard. You better know how all this deferred stuff, AR, Capitalized interest, AP, extension of receivable days and its effect on CFO, CFI. I think I need to know this blind. I can see how CFA is going to play in this section. We better review all the Level 1 formulas also.
I need to nail that SS7. Going to spend next 2.5 hrs on this fricking thing. Thanks for the feedback.
If you ever figure out how capitalized interest increases EBIT… let us know!
It is the reduction in depreciation year-on-year that increases EBIT. (of the capitalized interest). 64 Mill in 2007, 30 Mill in 2008… (or some such numbers if you remember).
cpk123 Wrote: ------------------------------------------------------- > It is the reduction in depreciation year-on-year > that increases EBIT. > (of the capitalized interest). > > 64 Mill in 2007, 30 Mill in 2008… > > (or some such numbers if you remember). would it not decrease EBIT? if interest expense gets capitalized, it then gets amortized…so i now have incremental depreciation that i would not have had if I had not capitalized the interest…this extra depreciation results in higher expenses, and lower EBIT? Not familiar with the specific example at hand, just thinking conceptually…
Capitalized Interest went down from 64 Mill in Year 1 to 30 Mill in Year 2. So in Year 1 - you would have had a much higher Depreciation expense, when compared to Year 2. With the lower depreciation expense in Year 2 - your EBIT would have increased higher… The other numbers provided - did not have such an incremental impact on EBIT (one was deferred revenue which in fact reduced EBIT, and the other was the Amortization of Software expense - which was not such a big impact). the question was specifically testing that (and of course your ability to read minute numbers on a MDA statement while on an online test).
I think I get it now. Cap. interest was 30mil for year 2, down 34mil from the year before. So depreciation was actually less this year compared to last year. However, why would it increase EBIT by 30mil and not 34mil as the answer explanation suggests. If this were the case then year1 64mil would increase EBIT by 64mil…
It would not increase it by the whole amount. they never told you how much the cap. interest was depreciated for. just facts to know - that a) depreciation expense year on year reduced. b) as a result ebit increased.
Ethics - 33% (yikes!), Quant 100%, FSA 67%, Equity 83%, AI 83%, Corp Fin 83%. I am in disbelief on some of the ethics stuff - XXX isn’t really part of the evaluation of best execution but it is the answer anyway???
i ran out of time/// what were most of the questions on corporate finance? and i agree… ethics was very brutal… for L2 retakers… was the l2 LAST YR just like the samples???
i thought EBIT would be the same??? am i off? or was this a different answer choice?
CFA, Which has the largest effect on increase in EBIT a) Interest Costs b)Software Costs c) Deferred revenue Interest costs Capitalization was $30MM and Software Capitalization was $4.5 (6.5-2.0) EBIT (includes depreciation) So the answer was A
hellomello Wrote: ------------------------------------------------------- > i ran out of time/// what were most of the > questions on corporate finance? and i agree… > ethics was very brutal… for L2 retakers… was the > l2 LAST YR just like the samples??? In terms of difficulty, I’d say they were on par.
I just scored 63% as well. But I know that I could have scored at least 2 more questions (>70%) if I had the test printed in front of me. It’s so hard to scroll up and down and you can’t underline, write, or circle anything. You would just forget things that you read. I thought it was going to be harder than this.
sales 300 cash operating expense 210 depreciation 30 operating income 60 interest 13.5 taxable income 46.5 tax(40%) 18.6 NI 27.9 Can somebody help me with after tax operating cashflow because I got another answer than the correct one?.. thanks.
(300-210-30)*(1-0.4)+30=66