[jeff]

@h0wdyus

Incorrect

The answer is B. Comparable sales.

“The use of comparable sales is not an income approach to valuation of a business, it is a market approach. Under the comparable sales approach, the value of a business is determined by comparing it to other entities with comparable characteristics for which the value is more readily determinable.”

This was a tricky one

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

[M.O.D.]

There is another way, which involves calculating the weighted average contribution margin per unit

4 = 80%: 18-12 = 6

1 = 20%: 22-14 =8

5 =100%

6 x .8 + 8 x .2 = 6.4 weighted average contribution margin

38400 + 28800 = 67200 required total CM to cover fixed costs and required profit

67200 / 6.4 per unit margin = 10,500 units

BA Mathematics, UC Berkeley
Certificates in CPA and EA preparation, College of San Mateo
CMA I 420, II 470
FAR 91, AUD Feb 2015 (Gleim self-study)

[JamesBJames]

That's pretty nifty, @M.O.D. That saves a lot of time not setting up equations.

FAR: May 1st, 2014 - 91
AUD: May 29th, 2014 - 97!
BEC: July 16th, 2014 - 91
REG: August 29th, 2014 - 88

Licensed December 2015

Feel free to add me on LinkedIn by clicking my username!

[Anonymous]

@MOD that's the way they taught us to do it in managerial accounting, I think it's much faster/more direct than the equation based approach!

[GoVPI]

Thank you all for the explanation. I made a C in cost accounting but it was purely by luck. I made 27s and 30s on the tests. I learned nothing, the professor was from another country and is tenured and retiring. He just said “do you see how I got this?” Class: no. Him: “good thing I'm retiring”

Needless to say, I am teaching myself everything.

BEC 8/14/14 - Passed
Graduated from college 12/13/14
AUD 8/31/15 - 74. Retake - Passed
REG
FAR

[Anonymous]

My cost accounting teacher was pretty bad too. He'd always tell us about his trip to China…every few days he'd ask “have I told you about my trip to China?”

[Anonymous]

Even when we told him yes he would still talk about it for an hour….

[Anonymous]

My grad managerial professor was similar, plus he made us write 25-30 page case study responses every single week… It was brutal 🙁

[Anonymous]

Can someone tell me if my understanding of monetary vs. fiscal policy is correct? This topic is confusing for me so I want to be sure I have it down.

Monetary policy is controlled by the Fed and includes open market operations, increasing/decreasing the reserve ratio, and increasing or decreasing the discount rate. This policy controls how much money is in the economy, especially to prevent inflation or deflation. When the Fed implements policies to increase the money supply, it leads to more inflation so the value of the dollar goes down, which leads to more exports because the US$ relative to foreign currency, has depreciated in value.

Fiscal policy is controlled through the government by increasing or decreasing taxes and government spending, which rather than just increasing the money supply in the economy, stimulates spending and doesn't depreciate the value of the dollar. Therefore, net exports would go down because the US$ has appreciated relative to foreign currency, leading to lower overall exports.

Is this right?

[M.O.D.]

The main purpose of both policies is to lift the economy out of a recession (or depression), ie to increase the GDP, not to control the currency or exports/imports (those are side effects)

Both try to stimulate economic activity (both buying and selling).

Increasing the money supply (monetary) policy is something the Fed can do on its own and is considered the quickest way to affect the economy.

Raising/lowering taxes as well as govt spending (including transfers like unemployment benefits) requires an act of Congress, and is considered slow, thus ineffective.

Overall, you have the right idea, but I would develop it more. Imaging answering an essay question on each.

BA Mathematics, UC Berkeley
Certificates in CPA and EA preparation, College of San Mateo
CMA I 420, II 470
FAR 91, AUD Feb 2015 (Gleim self-study)

[Anonymous]

Well everyone, I just rescheduled and pushed my test from august 9th to 23rd… I ended up getting a job offer and quitting my old job and staring a new one in the last three weeks and my whole study schedule basically disintegrated. A little punch to my pride since I told everybody that the 9th was the day I ended the madness but it would be a bigger hit if I took it too early and failed!

Wish me luck as I have already jumped back in and going strong!!

[Charell__]

Less than 4 hours! I'm so nervous but ready to get this thing over with!

[Anonymous]

@iAmGoingToPass

Good Luck, and You Are Going To Pass

=D

Destroy BEC

[Anonymous]

Goodluck today @iAmGoingToPass! Let us know how it goes!

[NJPRU]

Hey Amanda – just wanted to reach out to say Good Luck! 🙂

AUD: DONE
FAR: DONE
BEC: DONE
REG: DONE

IM GOING TO BE A CPA!!!!!

[gregt60]

Taking BEC on the 18th. Any suggestions on the best way to approach the written section? I have been hammering out MCQ and want to concentrate some time to the written portion over the next week.

FAR-80
AUD-75
BEC-78
REG-77

[Author]

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