1. 

   agniechaCPA2011
   

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   I am using Becker and I don't think they explain the Intercompany transactions well. I get what they explain in textbook, but when it came to MCH's i am like "huh?!?!?" I still have hard time grasping it.

   Anyone has any tips on intercompany transactions?
   At this point i am going to move on and hope to come back to it and get before Friday..maybe that's something not worth sweating for..

   REG-69,70,74,78
   AUD-73,86
   BEC-69,73,75
   FAR-65,73,84-I AM DONE!!!
   
   Used Becker mainly
   
   

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   Posted 6 months ago #
2. 

   agniechaCPA2011
   

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   @atelety I don't hate you :) I hate intercompany transactions. Thank you for your tip on simulation. I went back to Wiley book and looked at some simulations and I am kind of getting it, gotta know the J/E, I don't think test will give us a such big problems in sims as in old Wiley but it is good practice, I guess. I am praying for no such questions..

   REG-69,70,74,78
   AUD-73,86
   BEC-69,73,75
   FAR-65,73,84-I AM DONE!!!
   
   Used Becker mainly
   
   

   Posted 6 months ago #
3. 

   atelery
   

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   yup, good luck :)

   ~~~~~Passed~~~~~
   don't give up, this exam is not easy.

   Posted 6 months ago #
4. 

   Yvonne570
   

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   There's a lot to inter-company transactions. Yes, Becker provides the basic concepts to each part of what you need from acquisition of stocks - when to consolidate. What to do when you have less than 100% ownership.

   The key thing here is when you consolidate, you are incorporating the company's information along with the subsidiaries (showing the non-controlling interests). The consolidated entries are worksheet only so this can really confuse the concept.

   Understanding the entire objective is really helpful. Here's the consolidated results (we are only showing the company as a whole - remember don't duplicate the sales - so we are meshing the results as a combined - company/subsidiary).

   Is there a specific question you are stumbling on? Maybe we can clarify this.

   AUD - Passed:)
   FAR - Passed:)
   REG - Retake TBD
   BEC - Missed by 3 points Retake TBD

   Posted 6 months ago #
5. 

   agniechaCPA2011
   

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   @Yvonne, I think, I am grasping the whole concept, what gives me hard time is the sales eliminating entries, especially if there is ending inventory.

   Here is an example.

   During 2007, Shaw (sub) sold merchandise to Poe (parent) for $60,000, which included a profit of $20,000. At December 31,2007, half of this merchandise remained in Poe's inventory

   Answer with JE

   Sales $60,000
   COGS $50,000
   Ending Inventory $10,000

   Here is how I understand it:
   So originally COGS would be $40,000 but we need to eliminate half of profit $10,000 so we decrease EI to $10,000 and increase by $10,000. I have a feeling there is a better way to grasp it and i am confusing myself..

   REG-69,70,74,78
   AUD-73,86
   BEC-69,73,75
   FAR-65,73,84-I AM DONE!!!
   
   Used Becker mainly
   
   

   Posted 6 months ago #
6. 

   See Pee A
   

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   Always start with what you know. This was really tough for me and I truly never understood it. I just got the basic ones and skipped the rest since I didnt' have more time. Chances are, you will only get one or two questions on this, and within those possible questions, there is an even smaller chance of it being a very tough one.

   Start with debiting sales for 60 (obvious). Also, the buyer will take the full cost into it's EI (in a normal transaction.. their cost is the cost of buying... again, obvious). Go from there. Start with what you know, and then try and figure the rest. Helps a lot on test day since they often are not asking the truly difficult part of the question.

   BEC 86 (08/30/11)
   FAR 84 (10/13/11)
   REG 88 (11/08/11)
   AUD 86 (11/29/11)
   
   Exam prep - Becker self-study

   Posted 6 months ago #
7. 

   Yvonne570
   

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   During 2007, Shaw (sub) sold merchandise to Poe (parent) for $60,000, which included a profit of $20,000. At December 31,2007, half of this merchandise remained in Poe's inventory

   Answer with JE (worksheet entry)

   Sales $60,000
   COGS $50,000
   Ending Inventory $10,000

   Poe Shaw Total
   Sales 60000 60000
   COGS -50000 -50000
   Gross P 10000 10000

   Inventory 10000 10000

   Think about what the income statement and balance sheet amounts would look like if we did not eliminate them. In essence, we are eliminating (zeroing) the intercompany entries to zero out the inside transactions so we can end up with a whole company's results. We don't want $60000 sales to show, we want to hide the costs and the inventory. We want to wash these to only show the 3rd party and real items.

   AUD - Passed:)
   FAR - Passed:)
   REG - Retake TBD
   BEC - Missed by 3 points Retake TBD

   Posted 6 months ago #
8. 

   Yvonne570
   

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   Sorry, my excel example did not go through clearly but type up a simplified income statement and balance sheet to see it from that angle. Remember, we are just doing fake entries to make the statements more legit and real. Getting rid of junk. LOL:)

   AUD - Passed:)
   FAR - Passed:)
   REG - Retake TBD
   BEC - Missed by 3 points Retake TBD

   Posted 6 months ago #

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