[jeff]

Post by Another71.

Free Study Planner, Notes, Audio, Flashcards: https://www.another71.com/cpa-exam-study-plan/

Free CPA Exam Survival Guide: https://www.another71.com/cpa-exam-survival-guide/

AUD - 79
BEC - 80
FAR - 76
REG - 92

Jeff Elliott, CPA (KS)
NINJA CPA | NINJA CMA | NINJA CPE | Another71

[rossk]

Did anyone use the advance search option during the real exam for the research TBS ? I wanted to know if it is similar to the Becker advance search option.

[Robert Bentman]

@rossk Becker's research question formats are very similar to the exam. One big difference is that on the exam it will not say “wrong path” like Becker does

[AJE]

I have Becker….do I really need the actual book? I ask because I live abroad so by the time the book gets here it'll be another 2 to 3 weeks (they ship to my US address, my friend ships to me internationally) .

I just started watching the video lectures and it seems like they basically cover most of the entire book. Do I really need to actually read the book, or would my time be better spent just doing the video lectures, homeworks, and additional MC?

FAR 91 - 04/16
BEC 87 - 05/15
REG 77 - 07/27
AUD 92 - 08/31

[Anonymous]

sundizz, if you go into the homework section and start the MCQ's you can click on the “eBook” icon and it shows you the entire chapter of the book for that section with the notes/markups that you see in the lectures. Since I have already been through the book I tend to use this in my review more than the actual book.

[jackaroe]

Greetings from the Aud side of things. A simulation had a question on how the ‘fixed assets to equity' ratio [Fixed Assets (net of dep.)/SE] would be effected if a company reclassified a production facility to ‘held for sale' (HFS) status. The answer to the question stated that because the HFS asset is moved on the balance sheet the fixed assets portion of the ratio decreased. Logically, that would mean that the HFS asset is no long considered a fixed asset as the ratio is usually a percentage and there was nothing in the question to indicate any change in the denominator.

Would this held-for-sale facility no longer be considered a fixed asset on the balance sheet and moved into the current assets realm?

[Determined CPA]

On January 1 of the current year, Tell Co. leased equipment from Swill Co. under a 9-year sales-type lease. The equipment had a cost of $400,000 and an estimated useful life of 15 years. Semiannual lease payments of $44,000 are due every January 1 and July 1. The present value of lease payments at 12% was $505,000, which equals the sales price of the equipment. Using the straight-line method, what amount should Tell recognize as depreciation expense on the equipment in the current year?

Answer: Tell Co. must treat the lease as a capital lease because the present value of the minimum lease payments exceeds 90% of the fair value (sales price) of the equipment. Tell's cost equals the present value of $505,000. The question does not indicate or imply that Tell guarantees any residual value or that ownership transfers at the end of the 9-year lease. Therefore, the depreciable cost of $505,000 must be charged to depreciation over the period of use, which is the lease term of 9 years. The depreciation expense for the current year (one full year's depreciation) is $505,000 ÷ 9 years, or $56,111.

I don't see how the PV of lease pmts is greater than 90% of the FV…can someone please show me how this is calculated? I am taking 90% of 505,000 and getting $454,500 which is less than 400,000.

A - 75
B - 78 God is good.
F - 77 Answered prayers.
R - 84! Done!!

Paperwork sent - waiting for license!!
Still on a cloud and in shock. Through God, all things will happen.

[funtimesNOT]

AUDIT - 79
FAR - 64, 77
BEC - 69, 71,79 - DONE!
REG - 60, 75

Nothing in the 80s ; however, I worked full time the whole time! (like 10 hour days) so it can be done 🙂

[funtimesNOT]

AUDIT - 79
FAR - 64, 77
BEC - 69, 71,79 - DONE!
REG - 60, 75

Nothing in the 80s ; however, I worked full time the whole time! (like 10 hour days) so it can be done 🙂

[SkilletCPA]

@ Determined CPA: In this problem do not get confused with the original purchase price of the asset of $400,000, it is there to confuse you. $400,000 is the amount paid by original owner to acquire the asset to lease out. You are correct using the 90% of the PVMLP idea. Only for this problem it states, “The present value of lease payments at 12% was $505,000, which equals the sales price of the equipment.” So if you could calculate by dividing $505,000 by $505,000 which is greater than 90% and therefore a capital lease and carrying amount of the leased asset. Take $505,000 and divide by lessor of the useful life or the lease term, which in this case is the 9 years, resulting in $56,111.

BEC Pass
AUD Pass
REG Pass
FAR Pass

[Anonymous]

Determined, the question states that the PV of lease payments is equal to the sales price. Therefore the sales price (i.e. fair value) is 100% of the PV of lease payments.

[CPA50]

Hiya!

I've postponed this long enough. Throwing down the gauntlet the end of February. Gives me 8 weeks to study and conquer!

Good luck all!!

AUD - 80
BEC - 77
FAR - 80
REG - 80

3 years

+ 16 tests

+ 2 expired sections

= DONE FOREVER!

AUD 88 (expired), 80 retake
FAR 64,69,67,73,67,73,73,73, August 3
REG 75 (expired) September 7
BEC 72, 77

The adventure continues...

[Future Ninja]

did you know that:

NFPs should not record an expense for estimated uncollectible promises when promises to give are initially recognized.

AUD - 79 (expired) retaking July 28,2016
FAR - 76 expiring July 31, 2016
BEC - 85
REG - 74,74,74,74,59,70,

[SkilletCPA]

Can someone give me the journal entry series for this question?

On June 30, Huff Corp. issued at 99, 1,000 of its 8%, $1,000 bonds. The bonds were issued through an underwriter to whom Huff paid bond issue costs of $35,000. On June 30, Huff should report the bond liability at:

A.$955,000.

B.$990,000.

C.$1,000,000.

D.$1,025,000.

answer: The carrying value of the debt, initially, the bond liability, is $990,000, computed as the number of bonds multiplied by the face amount per bond, multiplied by the issue percentage:

1,000 bonds × $1,000 face × 0.99 = $990,000

BEC Pass
AUD Pass
REG Pass
FAR Pass

[Future Ninja]

@skillet: this is what I think. edited: i forgot the BIC.

June 30 entry:

cash……………………………………….955,000

BIC…………………………………………..35,000

discount on bonds payable………….10,000

………..cr bonds payable (always in your FACE)…..1,000,000

On june 30 for the BS presentation, our Bonds payable is:

BP always in your FACE ……1,000,000

less discount ……………………..(10,000)

Net…………………………………..990,000

AUD - 79 (expired) retaking July 28,2016
FAR - 76 expiring July 31, 2016
BEC - 85
REG - 74,74,74,74,59,70,

[SkilletCPA]

awesome, thanks!

BEC Pass
AUD Pass
REG Pass
FAR Pass

[Author]

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