FAR Study Group Q1 2017

CPA Exam Forum FAR FAR Review FAR Study Group Q1 2017

This topic contains 1,476 replies, has 80 voices, and was last updated by  norseman88 6 hours, 7 minutes ago.

Viewing 30 posts - 61 through 90 (of 1,477 total)
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  • #1400168
    mtaylo24
    mtaylo24
    Participant

    I can’t score an 80% on leases to save my life and have been stuck on this chapter for 3 days smh! Too damn tricky!


    A: 60, 61, 61, 78 (Expires May 17)
    R: 55, 69, 74, 75
    B: 71, 72, 73 (3/4/17)
    F: 52, 54 (3/10/17)
    AUD - 78
    BEC - NINJA in Training
    FAR - NINJA in Training
    REG - 75
    #1400211
    jalls
    jalls
    Participant

    @mtaylo24 When’s your exam? Mine’s the 9th. I’m almost there; half-way through bonds. It’s been a tough month here. I’m still debating whether to start my final review now or after governmental.


    Josh
    "All those who are around me are the bridge to my success, so they are all important." - Emmanuel "Manny" ("Pacman") Dapidran Pacquiao
    AUD - 73
    BEC - 77
    FAR - 68
    REG - 62
    #1400213
    mtaylo24
    mtaylo24
    Participant

    @jalls, Haven’t scheduled anything yet. Leaning towards early Feb….Im still debating whether I should start throwing BEC in the mix and sit for them both towards the end of the window. I don’t think that I’ll ever be ready for this section…

    Sidenote: I finally got a 90 on leases, gave me the greenlight to move to Derivatives/Hedges (yay). I can’t believe how many sessions that took.


    A: 60, 61, 61, 78 (Expires May 17)
    R: 55, 69, 74, 75
    B: 71, 72, 73 (3/4/17)
    F: 52, 54 (3/10/17)
    AUD - 78
    BEC - NINJA in Training
    FAR - NINJA in Training
    REG - 75
    #1400225
    GiniC
    GiniC
    Participant

    @mtaylo24 and @tarheel83 – please show how you arrived at the correct answer? I’m not getting there by any permutation I try…


    Prep using Becker live classes
    FAR scheduled for March 2017
    AUD - 95
    BEC - 82
    FAR - NINJA in Training
    REG - 82
    #1400232
    mtaylo24
    mtaylo24
    Participant

    @ginic

    Lease question


    A: 60, 61, 61, 78 (Expires May 17)
    R: 55, 69, 74, 75
    B: 71, 72, 73 (3/4/17)
    F: 52, 54 (3/10/17)
    AUD - 78
    BEC - NINJA in Training
    FAR - NINJA in Training
    REG - 75
    #1400297

    BondVillain
    Participant

    Grove Township issued $50,000 of bond anticipation notes at face amount in the current year and placed the proceeds into its capital projects fund. All legal steps were taken to refinance the notes, but Grove was unable to consummate refinancing. In the capital projects fund, what account should be credited to record the $50,000 proceeds?

    A. Other Financing Sources Control

    B. Revenues Control

    C. Deferred Revenues

    D. Bond Anticipation Notes Payable

    The answer is D. The explanation:

    Bond anticipation notes are included as general long-term liabilities. The amount would never be revenue or a deferred revenue as the amount is due to be repaid at some point.

    Comment: I’ve been studying governmental accounting for the last couple of days and thought that the 5 governmental funds – general, special revenue, capital projects, permanent and debt service fund; could not carry longterm debt.


    Q3 2015: AUD 87
    Q2 2016: REG 85
    Q3 2016: BEC 73, Retake 80
    Q1 2017: FAR
    AUD - 87
    BEC - 80
    FAR - NINJA in Training
    REG - 85
    #1400315

    Spartans92
    Participant

    Anyone have tips for JE on pensions. Im struggling to understand what account to debit and to credit. I understand the numbers just the accounts are driving me nuts. For instance, to record return on plan asset we have to first DR: Pension Benefit Asset CR: Net periodic Cost and then DR: Def. Tax Expense – I/S CR: DTL

    Im not quite understanding the logic. Any help is appreciated.


    BEC - 76
    REG- 67, 85
    AUD-63, 74, Retake Feb. 27
    FAR-65, 62
    #1400342
    mtaylo24
    mtaylo24
    Participant

    @Spartans

    Scenario: You are an employer and can only deposit 75,000 in a plan

    1. Deposited 75,000 in a plan

    Debit pension expense 75,000
    Credit cash 75,000

    2. Deposited 100,000 in a plan

    Debit pension expense 75,000
    Debit ppd expense 25,000
    Credit cash 100,000

    3. Deposited 65,000 in a plan

    Debit pension expense 75,000
    Credit cash 65,000
    Credit pension payable 10,000

    Scenario: Amended plan to improved benefits which is effective July 1 of this year. APBO increased 100,000 due to increase in service cost. Tax rate is 30%

    Debit OCI 70,000
    Debit Deferred Tax Asset 30,000
    Credit OPEB liability 70,000
    Credit Deferred tax benefit – OCI 30,000

    Scenario:

    Service cost 10,000
    Interest cost 2,500

    Debit Pension expense 12,500
    Credit Pension Liability 12,5000


    A: 60, 61, 61, 78 (Expires May 17)
    R: 55, 69, 74, 75
    B: 71, 72, 73 (3/4/17)
    F: 52, 54 (3/10/17)
    AUD - 78
    BEC - NINJA in Training
    FAR - NINJA in Training
    REG - 75
    #1400384

    Spartans92
    Participant

    @mtaylo, can you possibly explain the reason for the APBO one? why DR: OCI and CR: Def tax benefit? Im sorry if that sounds stupid.. but thats mainly my struggle to understand the account to use.


    BEC - 76
    REG- 67, 85
    AUD-63, 74, Retake Feb. 27
    FAR-65, 62
    #1400405
    mtaylo24
    mtaylo24
    Participant

    @Spartans I’ll give this a shot since I haven’t revisited the tax chapter yet. You adjust Oci for pensions when:

    1.) net gains (losses) are amortized as part of service cost or
    2.) a new determination of a funded status is made.

    The APBO one was a new determination of funded status since the plan was amended…

    We do the tax JE since that tax rate was mentioned.

    You Debit OCI and offset OPEB liability, then you debit deferred tax asset and offset the tax benefit, due to the temporary differnce…


    A: 60, 61, 61, 78 (Expires May 17)
    R: 55, 69, 74, 75
    B: 71, 72, 73 (3/4/17)
    F: 52, 54 (3/10/17)
    AUD - 78
    BEC - NINJA in Training
    FAR - NINJA in Training
    REG - 75
    #1400426
    mtaylo24
    mtaylo24
    Participant

    Can someone ‘splain when to use continuing ops vs oci when it comes to the foreign stuff? I keep getting this mixed up…


    A: 60, 61, 61, 78 (Expires May 17)
    R: 55, 69, 74, 75
    B: 71, 72, 73 (3/4/17)
    F: 52, 54 (3/10/17)
    AUD - 78
    BEC - NINJA in Training
    FAR - NINJA in Training
    REG - 75
    #1400433
    jalls
    jalls
    Participant

    Bond question anyone?

    I’m not sure how to get an answer on this. I’ll keep looking at my text. It’s probably a journal entry related to exercising warrants?

    Roaster Company issued bonds with detachable stock warrants. Each warrant granted an option to buy one share of $40 par value common stock for $75 per share. Five hundred warrants were originally issued, and $4,000 was appropriately credited to warrants. If 90% of these warrants are exercised when the market price of the common stock is $85 per share, how much should be credited to capital in excess of par on this transaction?

    A. $23,850
    B. $19,350
    C. $19,750
    D. $24,250


    Josh
    "All those who are around me are the bridge to my success, so they are all important." - Emmanuel "Manny" ("Pacman") Dapidran Pacquiao
    AUD - 73
    BEC - 77
    FAR - 68
    REG - 62
    #1400438
    jalls
    jalls
    Participant

    @mtaylor24 perhaps this is a little simplistic. I got it out of my “other” notes. I’m sure I’ve seen something very similar in Ninja Blitz and Notes on more than one occassion.

    “First, a remeasurement adjustment which goes through the income statement
    Second, a translation adjustment which goes through the statement of other comprehensive income”

    So, is it basically as easy as knowing the difference between a re-measurement and a translation? Even Gleim says that plus a bunch of other stuff in the summary of core concepts.

    “Foreign currency translation adjustments are reported in
    other comprehensive income” – Thanks for your summaries, Dr. Gleim, et. al.

    I’m sure I’ll be experiencing the joys of that soon. I once took advanced accounting that covered that. If nothing else, I got the book for reference..


    Josh
    "All those who are around me are the bridge to my success, so they are all important." - Emmanuel "Manny" ("Pacman") Dapidran Pacquiao
    AUD - 73
    BEC - 77
    FAR - 68
    REG - 62
    #1400448

    WANNABCPA
    Participant

    Anyone else find this exam to be hell to study for? Especially if you don’t work with public companies?


    BEC - 84
    REG - 87
    FAR - 2/3/17
    AUD - 3/10/17
    #1400450

    BondVillain
    Participant

    I’ve figured out my question by looking up the definition of “bond anticipation note.” Per Investopedia:

    DEFINITION of ‘Bond Anticipation Note – BAN’

    A short-term interest-bearing security issued in advance of a larger, future bond issue. Bond anticipation notes are smaller short-term bonds that are issued by corporations and governments, such as local municipalities wishing to generate funds for upcoming projects. The issuing bodies use the bond anticipation notes as short-term financing, with the expectation that the proceeds of the larger, future bond issue will cover the anticipation notes. Bond anticipation notes may be used when the issuer wants to delay a bond issue, or if the issuer wishes to combine several projects into one larger issue. Bond anticipation notes are typically payable from the proceeds of the sale of the bonds.

    So the moral of the story: the bond anticipation note is a short term debt instrument and thus can be carried by government fund.


    Q3 2015: AUD 87
    Q2 2016: REG 85
    Q3 2016: BEC 73, Retake 80
    Q1 2017: FAR
    AUD - 87
    BEC - 80
    FAR - NINJA in Training
    REG - 85
    #1400457
    mtaylo24
    mtaylo24
    Participant

    @jalls, Thanks, that makes perfect sense. I need to stop ignoring the summaries at the bottom, you would think that would be the only thing worth ignoring, but when they say study everything, you must study everything lol! It actually started to click as the questions began to repeat, but your explanation confirms where I was heading.

    I’m done w/ that hedging chapter (ALREADY!?!?!) Moving on to Stockholder’s Equity. This should be fun 👎


    A: 60, 61, 61, 78 (Expires May 17)
    R: 55, 69, 74, 75
    B: 71, 72, 73 (3/4/17)
    F: 52, 54 (3/10/17)
    AUD - 78
    BEC - NINJA in Training
    FAR - NINJA in Training
    REG - 75
    #1400523

    Spartans92
    Participant

    Got a bond question as well for y’all.
    On April 1, Year 1, Ward Corp. issued $750,000 of 10% nonconvertible bonds at 102 that are due on March 31, Year 11. Each $1,000 bond was issued with 40 detachable stock warrants, each of which entitled the bondholder to purchase one share of Ward $10 par common stock for $25. On April 1, Year 1, the market value of Ward’s common stock was $20 per share, and the market value of each warrant was $4. What amount of the proceeds from the bond issue should Ward record as an increase in stockholders’ equity?

    a.
    $300,000
    b.
    $120,000
    c.
    $15,000
    d.
    $750,000

    @jalls, is it B by any chance?


    BEC - 76
    REG- 67, 85
    AUD-63, 74, Retake Feb. 27
    FAR-65, 62
    #1400526

    Spartans92
    Participant

    I can’t make Bonds sink in even after the Roger videos.. While watching its very easy to follow and understand roger but then when I turn to becker. 90% of the time its like a foreign language. Very discouraging because I should be on Govt now but instead I’m like 3 chapters behind for this dang topic.


    BEC - 76
    REG- 67, 85
    AUD-63, 74, Retake Feb. 27
    FAR-65, 62
    #1400622
    GiniC
    GiniC
    Participant

    Thanks @mtaylo24 – it was one little word again – Monthly. I was doing all the calculations correctly but using each amount as the lease for the YEAR, not the month. With no idea of scale, it didn’t occur to me that the monthly rental I derived was too small. Rent for a single office in a large building, just to have a local presence (my company does that in some locations) would be that low.


    Prep using Becker live classes
    FAR scheduled for March 2017
    AUD - 95
    BEC - 82
    FAR - NINJA in Training
    REG - 82
    #1400688

    mckan514w
    Participant

    Hope everyone had a happy FAR holiday… family just left so I am back at it after about a week off…. ugh. ready to be done 🙁


    And they ask me why I drink

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

    #1400721

    stilgoin
    Participant

    My focus is 💩. I can’t seem to get through 3 questions without stopping. I took off 3 days and the guilt is insane! Must.Get.Through.FAR.To.Finish. 🙁


    “No one ever fails the CPA exam. There are only those who give up.” 

    • B- 78
    • A- 79
    • R- 82
    • F- 74
    • Ethics- 93
    #1400811

    Operation_CPA
    Participant

    @spartans92

    For bond questions with warrants I always look for a few things: Are you going to have to use the warrants only method or the market value method. In this particular problem we are only given the FV of the warrants, therefore, we use the warrants only method.

    JE’s that I use to help me solve the problem:

    DR: Cash 765,000 <—- 750,000 @ 102 (step 1)
    DR: Discount 105,000 (step 4 – plug)**

    …………….CR:B/P 750,000 (face of the bond) (step 2)
    …………….CR:APIC – warrants 120,000 (Step 3)*

    *there are 750 bonds and each bond has 40 detachable warrants (750 * 40) = 30,000. Each warrant has a market value of $4.00. So 30,000 warrants x 4 = 120,000

    ** the discount or premium I always do last, its a plug figure.

    The answer should be B. Honestly bonds are intimidating but once you understand the bond amortization table and the JE’s, answers will fall into your lap. Keep pushing guys.


    FAR - Q1 2017 - PASS
    AUD - Q1 2017
    REG - TBD
    BEC - TBD
    #1400831
    mtaylo24
    mtaylo24
    Participant

    I’m about to take a break myself and I’m already feeling guilty. Well not really a full break, I should have time to study on the side but the exam won’t be my priority again until Saturday.


    A: 60, 61, 61, 78 (Expires May 17)
    R: 55, 69, 74, 75
    B: 71, 72, 73 (3/4/17)
    F: 52, 54 (3/10/17)
    AUD - 78
    BEC - NINJA in Training
    FAR - NINJA in Training
    REG - 75
    #1400837

    Operation_CPA
    Participant

    @spartans92 (For some reason my post just disappeared…so I will try again)

    For bond questions with warrants I always look out for a few things: Are you going to have to use the warrants only method or the market value method? In this particular problem, we are only given the FV of the warrants. Therefore, we use the warrants only method.

    JE’s that I use to help me solve this problem:

    DR: Cash …..765,000 <— 750,000 @ 102 (STEP 1)
    DR: Discount..105,000 (STEP 4 <– this is a plug, I always do this last)

    ……………….CR: B/P ………….750,000 (STEP 2)
    ……………….CR: APIC – warrants..120,000 (STEP 3)*

    *There are 750 bonds and each bond has 40 detachable warrants (750 x 40) = 30,000 warrants. Now, each warrant has a market value of $4.00. So 30,000 warrants x $4.00 = $120,000.

    The answer should be B. Honestly bonds are intimidating, but once you understand the bond amortization table and the JE’s, answers will fall in to your lap. Keep pushing guys.


    FAR - Q1 2017 - PASS
    AUD - Q1 2017
    REG - TBD
    BEC - TBD
    #1400882
    Mscfisher
    Mscfisher
    Participant

    @jalls..not sure if anyone answered as yet but I am going with B.19,350

    Cash 33,750 (because $75 plus 1 warrant gives you 1 share and 90% of 500 warrants exercised)
    A.P.I.C- warrants 3,600
    common stock 18,000
    A.P.I.C 19,350


    Luck is when when preparation meets opportunity
    AUD - 77
    BEC - 83
    FAR - NINJA in Training
    REG - 83
    #1401086

    A1lessio
    Participant

    For you Becker users how do you feel about skipping F10? I can’t watch any more lectures or retain anything else. I have this whole week off and would like to kick off the review process now. The exam date is Jan 20th.


    People who subject themselves to the strictest discipline, who give up certain pleasurable things in order to obtain a goal are the happiest of men.
    AUD - 86
    BEC - NINJA in Training
    FAR - NINJA in Training
    REG - 84
    #1401105

    Operation_CPA
    Participant

    @a1lessio

    After having taken FAR twice, I highly recommend not skipping anything. Every exam is entirely unique and not studying any random chapter could be the difference between passing and failing.


    FAR - Q1 2017 - PASS
    AUD - Q1 2017
    REG - TBD
    BEC - TBD
    #1401314

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    #1401528

    mckan514w
    Participant

    finally got my NTS for my re-take and now just feel stalled out on when to schedule it… there aren’t a lot of open dates so I am either looking at Mid-January or Late February… I feel like Mid Jan is too soon but Late Feb too long… any helpful words of scheduling wisdom????


    And they ask me why I drink

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

    #1401530
    Mscfisher
    Mscfisher
    Participant

    @mckan. I am shooting for first week of February. Before the 14 so that i can get my score asap. January is basically here and i want be over prepared. What material are u using. Willey test bank was great for me for reg. All i have now is Becker any suggestions?


    Luck is when when preparation meets opportunity
    AUD - 77
    BEC - 83
    FAR - NINJA in Training
    REG - 83
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