June CFAI Mock Exams: WRONG/ERRONEOUS answers?

Has anyone else noticed that the latest mock exams released by CFAI have numerous mistakes in the answers? For ex. in the Afternoon Session:

  1. National Plastics Case, Question 2: The answer is clearly wrong. They suggest the sum of 156+32+61+(-134)+(-6) is 121?

  2. Sagara Case, Question 5: In their answer description they impy the answer is B yet they state the correct answer as C.

  3. Ready Power Case, Question 3: Again, their description implies the answer is B but they state the correct asnwer is A.

Anyone else notice these and any others?

i believe for NWC it was a net decrease in national plastics, so it would be an addition to FCFE

Yeah it looks like there are a few errors in the answers but the National Plastics answer of 121 looks right to me.

Errors that I’ve spotted are:

Sagara - Answer to question 5 should be B

Ready Power - Answer to question 3 should be B

Ready Power - Answer to question 4 should be C

Moyle - Answer to question 2 should be A

Ah yes, blademaster3090 and Swiftly, you guys are correct. Thanks for the additional pointers

CFAi is notorious for mistakes in mocks… considering how much revenue they generate you would think they would hire adequate people to deliver ERROR FREE mocks…

to clarify re ready power, lifo liquidation takes place when goods manufactured > goods sold? i thought that too initially, but their reasoning makes sense, you sell more than you manufacture, so you look to your older inventory to cover your extra sales, which would lead to a lifo liquidation.


LIFO liquidation takes place when goods sold > goods manufactured

Thanks so much for this. Happy to see my score is higher now.


as to Ready Power, question 6: why is Statement 3 correct (“The leasing program will decrease Ready Power’s liquidity position”)?

I’m thinking b/c cash lower b/c of the lease pmt?

If I understood it correctly, Ready Power is the lessor and receives the lease pmts (cash increases, lease receivable decreases).

Yes, I think you are right, Ready Power is the lessor.

Now I’m consused too. Seems like liquidity should be higher instead of lower?

Can someone please help us for this one?

I am following this too.

Regarding Ready Power Q6: Liquidity = Current Assets/Current Liabilities. The generators are stock for them so leasing them out would take them out of current assets and into long term recievables and therefore reduce the ratio.

Look at the BB example for this one (the lessor side)

Say , if its a 5 yr lease (4 yrs worth of lease receiveable gets moved to long term assets), only the current portion is recognised under the Current Assets so it goes down for the Lessor.

Thanks, guys, now it makes sense.

Why do they add the 61 into FCINV?

Not sure if I’m mistaken, but for the Piezo case question #4 of the CFAI mock that begins with the LeCompte Ethics case, I think the answer should be A rather than C.

In the answer they used $66 as the amount of capitalized interest to add to the Interest paid denominator, but it should be $34. I can;t seem to figure out how if could be $66 instead. Thoughts?


Thank you for this! I thought I was tripping with Ready Power.


I think answer C is correct.

66 = interest capitalized in 2013 (=value for B/S)

34 = part of capitalized interest allocated to I/S as part of depreciation expense

Interest Coverage Ratio = EBIT/interest expense

adj EBIT: + 34

adj interest expense: + 66 (if you add 34, you only add the part that was “depreciated” this year instead of the whole amount of capitalized interest in 2013, that is 66).

Hope it helps.