FAR Study Group Q3 2016 - Page 6

Viewing 15 replies - 76 through 90 (of 213 total)
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  • #784928
    ahugemistake
    Participant

    Scheduled september 3rd, this is getting painful

    FAR: 78*, 75
    REG: 76*, 85
    BEC: 79*, 76
    AUD: 79*, 93

    All scores expired, let's try this again.

    FAR - 78*
    AUD - 66, 79
    REG - 73, 76
    BEC - 79

    #784929
    KJ
    Participant

    Thanks Jmc0434!!. I realized after I posted. Just need to read the question carefully!!!

    AUD - NINJA in Training
    BEC - NINJA in Training
    FAR - NINJA in Training
    REG - NINJA in Training
    "Everything should be made as simple as possible, but not simpler" - Albert Einstein

    FAR - August 2016
    AUD - September 2016
    REG - October 2016
    BEC - November 2016

    Remember: "Everything should be made as simple as possible, but not simpler." - Albert Einstein

    #784930
    jolien
    Participant

    Hi everyone,

    I'm studying the Tax Income section in Becker and came across this question that I don't quite get.

    Venus Corp.'s worksheet for calculating current and deferred income taxes for Year 1 follows:

    Year 1
    Pretax income $ 1,400
    Temporary differences:
    Depreciation (800)
    Warranty costs 400
    Taxable income 1,000
    Loss carryback (1,000)
    Enacted rate 30%

    Year 2
    Pretax income –
    Temporary differences:
    Depreciation (1,200)
    Warranty costs (100)
    Taxable income (1300)
    Loss carryback 1000
    Loss carryforward 300
    Enacted rate 30%

    Year 3
    Pretax income $ 1,400
    Temporary differences:
    Depreciation 2,000
    Warranty costs (300)
    Taxable income 1,700
    Loss carryback 0
    Loss carryforward (300)
    Enacted rate 25%

    Venus had no prior deferred tax balances. In its Year 1 income statement, what amount should Venus report as:
    Current income tax expense?

    a) $0
    b) $420
    c) $300
    d) $350

    Answer: Choice “c” is correct, $300 current income tax expense (taxable income of $1,000 x 30%).

    My question: How come the loss carryback in year 1 is not accounted for? Taxable income = $1000 – 1000 (loss carryback) = $0. Therefore, answer would be (a). Am I missing something? According to Becker's answer, it looks like the Loss Carryback only generatesTax benefit, but not directly deducted from current year taxable income. Is that right?

    Thank you for your help!

    #784931
    syuanmeihong
    Participant

    hello!

    I just met a problem with the exercise below. Hope someone can help me resolve it!!!

    The fund financial statement display total fund balances for all governmental funds of $500,000. Other information as following.

    Capital asset: $600,000; Accumulated Depreciation: $250,000
    Infrastructure(Bridge, Road): $1,500,000; Accumulated Depreciation: $850,000
    Bond Payable: $800,000

    *Use modified approach to report the infrastructure

    Question: Net position associated with the governmental activities in the governmental-wide financial statement?

    The answer is 500,000+350,000-800,000=50,000

    I am wondering why not 500,000+350,000-800,000+1,500,000=1,550,000?? I understand that under modified approach, the infrastructure does not have to be depreciated. But does that mean that the infrastructure does not to be capitalized as an asset on the governmental-wide financial statement?????

    Thanks!

    #784932
    jmc0434
    Participant

    @jolien – Good question.

    The way I interpret the question was since this question asked “what is the current income tax expense in reported in Year 1 income statement” then the answer should be (TI @ year 1 x current rate = 1000 x 30% = 300) since Year 2 loss has not yet occurred.

    Truly I could not recall how NOL should be treated so I had to pull out the Becker book. So it seems when NOL occur they are recorded in the period in which they occurred. So if we look at Year 2 as an example I would assume the carryback and the carry forward entries would be the following in Year 2:

    Carryback:
    Dr. Tax Refund Receivable 300
    Cr. Tax Benefit 300

    Carryforward
    Dr. Deferred Tax Asset (which will decrease future income tax expense) 90*
    Cr. Tax Benefit 90

    *YR2 carryforward x YR2 enacted rate = 300 x .3 = 90

    The tax benefit will deduce the loss on the YR2 financial statements.

    I hope this helps!

    BEC - 79
    AUD - 89
    REG - 80
    FAR - 7/19/16

    #784933
    steph
    Participant

    Does anyone have any advice about extra content I can buy/review/find online for understanding pensions? I feel like the info in Becker is inadequate to explain all the journal entries. I'm gonna try my old intermediate textbook later but currently wondering what other people did to master this section

    Aud-passed April 2016

    Bec-passed May 2016

    Far-passed Aug 2016

    Reg-scheduled May 16 2017 (fingers crossed)

    AUD - Passed in May
    BEC - Passed in June
    FAR - Waiting for score
    REG - Planning it for Q4
    We can do this ninjas!

    #784934
    steph
    Participant

    Does anyone have any advice about extra content I can buy/review/find online for understanding pensions? I feel like the info in Becker is inadequate to explain all the journal entries. I'm gonna try my old intermediate textbook later but currently wondering what other people did to master this section

    Aud-passed April 2016

    Bec-passed May 2016

    Far-passed Aug 2016

    Reg-scheduled May 16 2017 (fingers crossed)

    AUD - Passed in May
    BEC - Passed in June
    FAR - Waiting for score
    REG - Planning it for Q4
    We can do this ninjas!

    #784935
    jmc0434
    Participant

    Please tell me I am not the only one struggling with Bonds. I am getting almost every question incorrect in the Becker software! It is VERY frustrating especially with my exam around the corner!

    BEC - 79
    AUD - 89
    REG - 80
    FAR - 7/19/16

    #784936
    cpaMD86
    Participant

    It's normal to try and think back on topics and completely blank out, right? I'm taking the approach of watching all of the lectures (Roger) while taking notes. Once I do that I am going all in on MCQ….I start to panic a bit when I can't remember things!

    AUD - 80
    BEC - 80
    FAR - 82
    REG - 79
    Be willing to be inconvenienced for your conviction.

    Roger/Ninja MCQ/Ninja Notes

    FAR: 9/3

    #812850
    jeff
    Keymaster

    test

    AUD - 79
    BEC - 80
    FAR - 76
    REG - 92
    Jeff Elliott, CPA (KS)
    NINJA CPA | NINJA CMA | NINJA CPE | Another71
    #812979
    Operation_CPA
    Participant

    @jmc0434

    Know your bond amortization table like the back of your hand, and really nail down journal entries. A lot of times with the journal entries the answer falls in your lap. Keep pushing!

    FAR - 76 (Lost credit), 76
    AUD - 80
    BEC - 76
    REG - 75

    Truly I tell you, if you have faith as small as a mustard seed, you can say to this mountain, "Move from here to there," and it will move. Nothing will be impossible for you.

    #813189
    livealittle
    Participant

    The fair value for an asset or liability is measured as:
    a. The appraised value of the asset or liability.
    b. The cost of the asset less any accumulated depreciation or the carrying value of the liability on the date of the sale.
    c. The price that would be paid to acquire the asset or received to assume the liability in an orderly transaction between market participants.
    d. The price that would be received when selling an asset or paid when transferring a liability in an orderly transaction between market participants.

    I think I put this in the Reg group when I was trying for the Far group.

    not sure I can navigate in this new forum.

    BEC - 8/8/16
    REG - 66, 77
    AUD - 81
    FAR - 9/8/16

    #813192
    pharaoh
    Participant

    @livealittle – is it d?

    AUD - 93
    BEC - 79
    FAR - 84
    REG - 83

    FAR 8/2016
    AUD 1/2017
    REG TBD
    BEC TBD

    #813225
    Teal
    Participant

    Aww, what happened to the signatures with our test scores? Anyway, QUESTION: I know extraordinary gains were eliminated, but they were eliminated for Government accounting and IFRS too right? Thanks!!!

    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

    #813234
    Teal
    Participant

    Also, are prepaid taxes a current asset? I am pretty sure they are, just wanted to be sure!

    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

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