Free CIMA CIMAPRA19-F02-1-ENG Exam Questions

Become CIMA Certified with updated CIMAPRA19-F02-1-ENG exam questions and correct answers

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Total 270 Questions | Updated On: Oct 27, 2026

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Question 1

JKL measure gearingas debt:equity, based on book values.At 31 December 20X5the ratio is 2:3 and JKL would like this to be 2:5.

Which of the following transactions individually would achieve this?

A : nus issue from the share premium account.

B : valuationof investment propertyto an increased fair value.

C : payment of a6 year termloan with the issue of 5 year redeemable debentures.

D : ue of redeemable preference shares at par.

Answer: B

Question 2

The dividend yield of ST hasfallen in theyear to 31 May 20X5, compared to the previous year.

The share price on 31 May 20X4 was $4.50 and on 31 May 20X5 was $4.00. There were no issues of share capital during the year.

Whichof the following should explain the reduction in the dividend yield for the year to 31 May 20X5 compared to the previous year?

A : dividend paid in the year was reduced in order to pay for new assets.

B : rplus cash was used to pay a special dividend in additionto the normal dividend in the year.

C : The profit for the year fell significantly and the dividend per share stayed the same.

D : compensate investors for thereduction in share price a higher dividend per share was paid.

Answer: A

Question 3

Which of the following best describes the goal of WACC as a measure?

A : work out the average return that is required by the company on its investments in order to satisfy all shareholders and debt holders.

B : work out the average return that is required by the company on its investments in order to satisfy all shareholders.

C : work out the average return that is required by the company on its investments in order to satisfy all debt holders.

D : work out the minimum return that is required by the company on its investments in order to satisfy all shareholders and debt holders.

Answer: A

Question 4

MNO is listed on its local stock exchange. It has a high level of gearing compared to the industry average as a result of rapid expansion funded by debt. The directors of MNO would like to reduce the level of gearing by raising equity to fund the next expansion project. The directors are considering whether to use a placing of new shares or a rights issue.

Which of the following statementsis true?

A : rights issue would not need to be underwritten because the risk of the shares not being taken up is small compared to a placing.

B : administration costs associated with a placing are usually more expensive than a rights issue because less investors are involved.

C : placing will increase the proportion of the total number of MNO's shares held by large investors.

D : directors must use a placing before offering the rights issue to existing shareholders.

Answer: C

Question 5

Information from the financial statements of RST for the year ended 30 April 20X9 is as follows:

At 30 April 20X9 the ordinary shares are trading at $4.75.

What is the price earnings (P/E) ratio for RST at 30 April 20X9?

A : 15.83

B : 7.92

C : 10.56

D : 9.31

Answer: A

Page: 1 / 54

Total 270 Questions | Updated On: Oct 27, 2026

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