[jeff]

Welcome to the Q4 2016 CPA Exam Study Group for BEC.

If this is your first post in the study group – please post your target exam date (just the time frame to preserve your anonymity), and your past history with this exam (optional, of course).

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

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

[Accountingbeans]

Taking BEC on October 11th. First one! Have a question about a Becker problem:

Kimbeth Manufacturing uses a process cost system to manufacture Dust Density Sensors for the mining industry. The following information pertains to operations for the month of May:
Units
Beginning work-in-process inventory, May 1
16,000
Started in production during May
100,000
Completed production during May
92,000
Ending work-in-process inventory, May 31
24,000

The beginning inventory was 60 percent complete for materials and 20 percent complete for conversion costs. The ending inventory was 90 percent complete for materials and 40 percent complete for conversion costs.

Costs pertaining to the month of May are as follows:
Beginning inventory costs are: materials, $54,560; direct labor $20,320; and factory overhead, $15,240.
Costs incurred during May are: materials used, $468,000; direct labor, $182,880; and factory overhead, $391,160.
Using the weighted-average method, the total cost of the units in the ending work-in-process inventory at May 31, 1995, is:

a.
$153,960
b.
$154,800
c.
$156,960
d.
$155,328

Can anyone help me out? Answer is C, but I don't understand the explanation that was given.

BEC- 81

AUD- 82

REG- 75

FAR- 81

Newbie
BEC- August 31

[mckan514w]

@Accountingbeans you are being asked to find the total cost of ending WIP- this would include both your materials and your conversion cost.

To begin with you need to find your Equivalent Units for both under weighted average. Weighted average ignores beginning inventory

So starting with Materials you have 92,000 units completed + 24,000 units that are 90% completed so 92+24(.90)=113.6 Units as it relates to materials

Ending units that pertain to your Conversion cost consist of 92,000 units completed + 24,000 that are 40% complete so 92 +24(.40)=101.6 Units

The second step is to find out how much per unit– under weighted average you ignore the percentage completion of beginning WIP so your total materials amount
Beg WIP MATERIALS=54.56 is added to
what was added during the year =468
For a total of 522.56

Divide that by your material EU of 113.6 for a total per unit cost of $4.6
This is multiplied by the amount that is sitting in End WIP that has been completed so out of 24,000 units 90% are completed in terms of material so 24*.90=21.6 Units multiplied by 4.6= total materials of 99.36

The question is asking for TOTAL so you will need to go through the same steps as above to find your ending cost as it pertains to conversion cost. Remember that your conversion cost is DL + MFG OH

Once you go through all of that you end up with a conversion cost per unit of $6 X end units of 9.60 for conversion cost of 57.6

57.6(MATERIAL) +99.36 (CONVERSION)= answer C- 156,960

Hope this helps.

And they ask me why I drink

BEC 71, 82
AUD 75
REG 75
FAR 61, 69, 83

and they ask me why I drink...

FAR- 61-next time I'll ask for lube instead of a calculator
REG-75- Never been so happy to see such a low grade
BEC- 8/11
AUD- 9/2

[RE2PECT]

This may be a dumb question, but when a mcq gives you net income and then after tax interest expense, do you add that back or subtract it from net income?

"Luck is what happens when preparation meets opportunity."

Roger & Ninja

FAR: 75
AUD: 73, 81
BEC: 71, 73, 82
REG: 68, 82

FAR: 75 Roger & Ninja (notes/flashcards/audio/MCQ)
AUD: 73, 81
BEC: 71, retake 8/29
REG:

[mckan514w]

Can you give an example Re2pect? I want to say you add it back in but that it depends on what you are trying to arrive at???

And they ask me why I drink

BEC 71, 82
AUD 75
REG 75
FAR 61, 69, 83

and they ask me why I drink...

FAR- 61-next time I'll ask for lube instead of a calculator
REG-75- Never been so happy to see such a low grade
BEC- 8/11
AUD- 9/2

[RE2PECT]

I can't for certain reasons ;). I'm just trying to figure out what net income would be. I did it both ways and of course both numbers I came up with were answer choices lol. I don't even think the question was asking for net income, but it was part of the calculation. I just remember not knowing if it needed to be added or subtracted from it.

"Luck is what happens when preparation meets opportunity."

Roger & Ninja

FAR: 75
AUD: 73, 81
BEC: 71, 73, 82
REG: 68, 82

FAR: 75 Roger & Ninja (notes/flashcards/audio/MCQ)
AUD: 73, 81
BEC: 71, retake 8/29
REG:

[mckan514w]

🙂 Yeah I got one of those questions floating around in my head and am trying to figure out a way to ask it —

Anyway I think if you are being asked to calculate operating cash flow or cash flow for debt service coverage (FCF) then you add back in the interest expense and depreciation. (I could be wrong here)

And they ask me why I drink

BEC 71, 82
AUD 75
REG 75
FAR 61, 69, 83

and they ask me why I drink...

FAR- 61-next time I'll ask for lube instead of a calculator
REG-75- Never been so happy to see such a low grade
BEC- 8/11
AUD- 9/2

[Teal]

Taking October 3rd! This is my first time with this test. I meant to have been studying for the last week and a half (and I have, but not as much as I should have been!) So here I am, dedicating the rest of the time until my exam for this test 🙂

AUD - 82
BEC - 79
FAR - 75
REG - 77

NINJA & Roger

Passed AUD!

Passed BEC!

Passed FAR!

Passed REG!

FAR (66,68) Aug 26
REG (66) July 25
AUD (66) December 1st
BEC - October 3rd

[RE2PECT]

I'm taking it on 10/3 as well. DO NOT underestimate this exam just because it has the highest pass rate. This will be my third and hopefully last attempt at this beast.

I posted this in the last study group and figured I'd post it again for whoever's taking it this window. If you're using Ninja this might be useful during your review. I had a bigger list of calculation questions, but a lot of the question numbers didn't match up and Jeff said it's because the numbers change when new ones are added.

Variances

DLEV- 881, 1181, 1320, 1322
DMPV- 938, 916, 918, 1046
DMUV- 903, 907
DLRV- 880, 908
DMPV & DMUV- 1028
OH Spending Variance- 902, 917
VOH Efficiency- 1012, 1201
Selling Variance- 889
Flexible Budget Variance- 894
Production Variance- 1013

Process Costing

Conversion Costs- 892
W/A- 1052, 1061, 1271
W/A conversion cost per unit- 1184
Costs transferred out- 1079
W/A equiv units- 1053
FIFO equiv units- 1062
W/A conversion cost- 1038

Break Even Analysis

Margin of Safety- 1283
B/E units- 845, 849, 859, 904, 909, 920, 944
B/E analysis- 904, 909
B/E sales- 1156
Finding FC using B/E- 1266

Ratios

Profit Margin Percentage- 926
ROI- 977, 980
ROE- 1162
ROA- 961
Residual Income- 960, 984, 971, 979,
EVA- 970
ROI & Res Inc- 993
Return on Sales- 923
WACC- 391
Times Interest Earned- 423
Cost of Equity- 326
Debt to Equity- 481
Degree of Financial Leverage- 372
Cost of P/S- 324, 377, 378, 386
A/R Turnover- 1144
# Days Sales in Inv- 485
Inventory Turnover- 348, 471, 369
Inventory Reorder Point- 466, 469, 470
Annual Financing Cost- 456, 441
EOQ- 436
Cost of safety stock- 462

Capital Budgeting

NPV- 337, 263, 1365, 265, 337, 253, 262
IRR- 251, 250, 269, 866
Payback Period- 247, 360, 272, 274

Cost Accounting

OH Costs- 921, 1024, 1032
OH Applied- 910, 1063
COGM- 1082, 1270, 886
Joint Product Costs- 1025, 1007, 1083
Byproduct cost of sales- 1008
Variable & Absorption Costing- 1203, 1090, 1309, 1310, 974, 1006

"Luck is what happens when preparation meets opportunity."

Roger & Ninja

FAR: 75
AUD: 73, 81
BEC: 71, 73, 82
REG: 68, 82

FAR: 75 Roger & Ninja (notes/flashcards/audio/MCQ)
AUD: 73, 81
BEC: 71, retake 8/29
REG:

[mckan514w]

Agree with Re2pect- do not underestimate this exam- I am still waiting on my NTS payment coupon (grrrrr District of Columbia you make everything so painful) but am hoping to sit as soon as I can get it scheduled….

I have a stupid question— is EVA the same as Residual Income?? (After-tax operating – (total invested assets * Rate of Return (or WACC) ) I feel like I should know this but well I don't 🙂

And they ask me why I drink

BEC 71, 82
AUD 75
REG 75
FAR 61, 69, 83

and they ask me why I drink...

FAR- 61-next time I'll ask for lube instead of a calculator
REG-75- Never been so happy to see such a low grade
BEC- 8/11
AUD- 9/2

[smyoung0521]

Hi! I am back at this beast after a 2 year break…My previous attempt at this exam consisted of one take of BEC that I got a 64 on. I hated the study program I had as it did not work for me. Now I am back at it going after BEC first using Rogers and supplementing with Ninja. I plan to test sometime in November.

Looking forward to learning with all of you!

AUD - NINJA in Training
BEC - 64
FAR - NINJA in Training
REG - NINJA in Training

Every journey begins with a step.
Starting over again after an extended time.
Using Roger's and Ninja 10 pt combo

Restarting my journey!
Using Rogers and supplementing with Ninja

[jad11]

@mckan514w

They are similar, but they are not the same. It looks like Residual income is a bit more flexible in what you are allowed to use as rate of return (can be more subjective) and EVA is a set formula. Also, EVA can be adjusted by capitalizing R&D and other things, while residual income doesn't allow for such changes, but I don't recall this being a big deal in the lecture/mcq.

Residual Income
1.Residual income = Net income -Required Return
2.Required return = NBV(equity) * hurdle rate
3.Rate of return may be WAAC, cost of equity, or target return rate

EVA
1.EVA=NOPAT-Required Return
2.NOPAT=EBIT * (1-Tax rate)
3.Required return = WAAC

[Teal]

Now I'm nervous….I will focus a lot of time on it. Everyone at my firm says it is so easy, but you are right, it still seems like a lot of people underestimate this material as I am going through it…

AUD - 82
BEC - 79
FAR - 75
REG - 77

NINJA & Roger

Passed AUD!

Passed BEC!

Passed FAR!

Passed REG!

FAR (66,68) Aug 26
REG (66) July 25
AUD (66) December 1st
BEC - October 3rd

[Danish]

HI Guys,
I am very nervous, my exam is on Oct 7th and i am still getting around 65% on my Ninja MCQs. Any advice will help!

[mckan514w]

thanks! jad11

And they ask me why I drink

BEC 71, 82
AUD 75
REG 75
FAR 61, 69, 83

and they ask me why I drink...

FAR- 61-next time I'll ask for lube instead of a calculator
REG-75- Never been so happy to see such a low grade
BEC- 8/11
AUD- 9/2

[Just3Letters]

Hey everyone,

I haven't been on here a lot with work and studying but I feel that I owe this forum for all the help it's given me. I passed BEC with 80 last month and now I only have audit left! Anyways, here's my super delayed exam experience:

The first testlet seemed easier than it was for FAR and REG which was probably expected. However, my second was defintely more difficult than I expected any part of that exam to be! This is not to scare anybody but I agree with Mckan to not take this exam lightly. Becker/Ninja MCQ covered all the material on the exam but there were questions in my second/third testlets that added extra pieces which I haven't even considered. Make sure you know your formulas (EVA, Residual Income, Turnovers, etc.) because I got some questions where you had to do one of those formulas/ratios but then there was an extra piece that you had to figure out. I don't want to be more specific but if you have the formulas down cold you will be OK on these questions.

The third testlet was maybe a little easier or the same difficulty as the second. I struggled with and flagged 6 or 7 questions or each testlet which scared me for sure. However, I felt that I was able to go back while keeping with my time schedule and figure out some educated guesses. The third testlet could have easily been an extension of my second.

Note: I'm talking about ratios and stuff but I also struggled with some conceptual knowledge things in general business/economics. It's just so much more difficult to tackle all of the possible information that could show up as conceptual questions. Don't neglect the conceptual stuff!

The fourth testlet (WC) was pretty easy and straightforward for me. I just wrote a few paragraphs on each and made it sound professional with some key words. I probably passed because of WC.

Anyways, I need to head off to work but have a good day studying everybody!

AUD - 89
BEC - 80
FAR - 81
REG - 81

I hope my friends remember my name.

FAR- 81
REG- 81
BEC- Aug 22, 2016
AUD- TBD

[Author]

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