OCR Business studies F297 - SHL Pre- Release 2014/2015

Spoke to a friend, she said the best ones to remember are Acid test, current ratio and gearing; so

Current ratio = Current assets divided by current liabilities.
In this case - 2012 = 15662/9206 = 1.7
2013 = 17039\10660 = 1.6

Acid test ratio is: Current assets - stock divided by current assets.
So... 2012 = 8720/9206 = 0.95 and 2013 = 10335/10660 = 0.97
(Evaluate on that saying there is a slight improvement in 2013 but both are unhealthy.
Finally gearing ratio is - long term liabilities divided by capital employed x 100.
Applying it = 2012: 1722/8799 x 100 = 19.6% and 2013: 2648/10285 x 100 = 25.7%
(Evaluate saying this is suitable - high gearing is usually over 50% which may suggest a high proportion of finance is though loans)

I'm hoping this is right, may pick us up a few extra marks.

guys one thing to remember... do not assume that SHL will receive 25% of the projected profits if they were to purchase a stake in mardidi AND do not assume that they receive 100% either! If a questions comes up on mardidi and you have to speak about the pay back period or ARR, make sure you state that it is unclear whether or not the projected profit represents SHL's 25% share of the profits, or whether its all theirs!

I understand this but say the calculation question was not CPA but to work out payback period and ARR, what would be best advised to use? Or would exam board realise this is unclear and award for both assumptions.

Doing the exam tomorrow, just wondering if anyone has an idea on what one of the decision tree questions look like? I know how to illustrate one, but not sure on how they'll ask the question

Is this a joke? I think you may have the wrong exam board.

most things are correct, however acid test ration is : (current assets-stock)/current liabilities, NOT CURRENT ASSETS!

nope, I have a F297 revision pack which includes decision trees

Good luck to everyone, just remember to read the question in front of you and don't answer the question you want to have.

See you on the other side.
Mark

Good luck to everyone, just remember to read the question in front of you and don't answer the question you want to have.

See you on the other side.
Mark

Spoke to a friend, she said the best ones to remember are Acid test, current ratio and gearing; so

Current ratio = Current assets divided by current liabilities.
In this case - 2012 = 15662/9206 = 1.7
2013 = 17039\10660 = 1.6

Acid test ratio is: Current assets - stock divided by current assets.
So... 2012 = 8720/9206 = 0.95 and 2013 = 10335/10660 = 0.97
(Evaluate on that saying there is a slight improvement in 2013 but both are unhealthy.
Finally gearing ratio is - long term liabilities divided by capital employed x 100.
Applying it = 2012: 1722/8799 x 100 = 19.6% and 2013: 2648/10285 x 100 = 25.7%
(Evaluate saying this is suitable - high gearing is usually over 50% which may suggest a high proportion of finance is though loans)

I'm hoping this is right, may pick us up a few extra marks.

What is capital employed?!?!?