Full exam for Accounting, Finance & Control in the Management Engineering degree programme at Politecnico di Milano. The document covers: ACCOUNTING, FINANCE & CONTROL Written Test - Call I – 25th January 2022 QUESTION 1 - (3 POINTS) Alpha manufactures and sells simple copper products. Suppliers of raw materials allow Alpha to postpone the payment of invoices. The following accounting information is available: •
Full exam for Accounting, Finance & Control in the Management Engineering degree programme at Politecnico di Milano. The document covers: ACCOUNTING, FINANCE & CONTROL Written Test - Call I – 25th January 2022 QUESTION 1 - (3 POINTS) Alpha manufactures and sells simple copper products. Suppliers of raw materials allow Alpha to postpone the payment of invoices. The following accounting information is available: •
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ACCOUNTING, FINANCE & CONTROL Written Test - Call I – 25th January 2022 QUESTION 1 - (3 POINTS) Alpha manufactures and sells simple copper products. Suppliers of raw materials allow Alpha to postpone the payment of invoices. The following accounting information is available: • ATR = 0.5 • Cash flow from operating activities = +2,700 € • Cost of consumption of raw materials = 24,000 € • Cost of labour = 9,000 € • Current assets = 10,000 € • Current bank debts = 1,000 € • Current bonds = 2,000 € • Current Ratio = 1.25 • Financial income = 500 € • Corporate tax rate = 40% • Third Part Liabilities / Equity = 0.6 • Nominal value of shares = 2 €/share • Share price = 2.4 €/share • Non-current bank debts = 14,000 € • Non-current bonds = 8,000 € • Number of issued shares = 10,000 shares • Other current financial liabilities = 0 € • Reserves = 27,600 € • Revenues = 40,000 € • ROS (Ebit Margin) = 12.5% • Changes in the value of finished goods (final – initial) = +2,000 € • Changes in the value of raw materials (final – initial) = +1,000 € • Trade Payables are the only Current Non Financial Liabilities • VAT = 0% Based on the available information: Which is the average cost of financial liabilities? A. 10% B. 6% C. 2% D. None of the other answers is correct QUESTION 2 - (3 POINTS) Based on the above data available about Company Alpha (Question 1), how many days, on average, are needed to collect payables? A. around 73 days B. around 68 days C. around 79 days D. It cannot be calculated with the available data SOLUTION QUESTION 1 Knowing that ATR = Revenues / Assets, Assets = Revenues / ATR = 40,000 / 0.5 = 80.000€. Assets are always equal to Equity + Third part Liabilities = 80,000€ Knowing that Third part Liabilities / Equity = 0.6, Equity = Assets / (1+0.6) = 50,000€ Equity =…
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