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Free CIMA CIMAPRO19-F03-1-ENG Exam Questions

Absolute Free CIMAPRO19-F03-1-ENG Exam Practice for Comprehensive Preparation 

  • CIMA CIMAPRO19-F03-1-ENG Exam Questions
  • Provided By: CIMA
  • Exam: F3 Financial Strategy
  • Certification: CIMA Professional Qualification
  • Total Questions: 305
  • Updated On: May 24, 2026
  • Rated: 4.9 |
  • Online Users: 610
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  • Question 1
    • A company is funded by:
       • $40 million of debt (market value)
       • $60 million of equity (market value)
      The company plans to:
       • Issue a bond and use the funds raised to buy back shares at their current market value.
       • Structure the deal so that the market value of debt becomes equal to the market value of equity.
      According to Modigliani and Miller's theory with tax and assuming a corporate income tax rate of 20%, this
      plan would: 

      Answer: C
  • Question 2
    • A company is undertaking a lease-or-buy evaluation, using the post-tax cost of bank borrowing as the discount
      rate.
      Details of the two alternatives are as follows:
      Buy option:
       • To be financed by a bank loan
       • Tax depreciation allowances are available on a reducing-balance basis
       • Assets depreciated on a straight-line basis
      Lease option:
       • Finance lease
       • Maintenance to be paid by the lessee
       • Tax relief available on interest payments and book depreciation
      Which THREE of the following are relevant cashflows in the lease-or-buy appraisal?

      Answer: A,D
  • Question 3
    • A listed company in a high growth industry, where innovation is a key driver of success has always operated a
      residual dividend policy, resulting in volatility in dividends due to periodic significant investments in research
      and development.
      The company has recently come under pressure from some investors to change its dividend policy so that
      shareholders receive a consistent growing dividend. In addition, they suggested that the company should use
      more debt finance.
      If the suggested change is made to the financial policies, which THREE of the following statements are true?

      Answer: A,B
  • Question 4
    • A company plans to acquire new machinery.
      It has two financing options; buy outright using a bank loan, or a finance lease.
      Which of the following is an advantage of a finance lease compared with a bank loan?

      Answer: B
  • Question 5
    • The Board of Directors of a listed company is considering the company's dividend/retentions policy.
      The inflation rate in the economy is currently high and is expected to remain so for the foreseeable future.
      The board are unsure what impact the high level of inflation might have on the dividend policy.
      Which THREE of the following statements are true?

      Answer: B,C,D
PAGE: 1 - 61
   
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