[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

[klink24]

@M.O.D., thanks. I thought I had one for you guys, but it turned out I missed the part about the 30% marginal tax rate, lol. When I come across one I'll post it.

By the way, thanks to everyone that's contributed so far. I've been reading through the past couple of pages and it's been helpful in clearing up a few things.

FAR: 4/19/2014 - 85!
AUD: 5/27/2014 - 90!
REG: 7/18/2014 - 81!
BEC: 8/13/2014 - 84!

4 up, 4 down, in 4 months.

Licensed 9/22 in NC.

[klink24]

Which of the following formulas should be used to calculate the economic rate of return on common stock?

A. (Dividends + change in price) divided by beginning price.

B. (Net income – preferred dividend) divided by common shares outstanding.

C. Market price per share divided by earnings per share.

D. Dividends per share divided by market price per share.

FAR: 4/19/2014 - 85!
AUD: 5/27/2014 - 90!
REG: 7/18/2014 - 81!
BEC: 8/13/2014 - 84!

4 up, 4 down, in 4 months.

Licensed 9/22 in NC.

[stoleway]

This is tricky

Pinecrest Co. had variable costs of 25% of sales and fixed costs of $30,000. Pinecrest’s breakeven point in sales dollars was

A. $24,000

B. $120,000

C. $30,000

D. $40,000

REG -63│ 84!!
BEC- 59│70│ 71 │78!
AUD- 75!
FAR- 87!

Mass-CPA

[stoleway]

@klink24

A

REG -63│ 84!!
BEC- 59│70│ 71 │78!
AUD- 75!
FAR- 87!

Mass-CPA

[klink24]

@stoleway, that's right. I was lost when I first read it because it said “economic” rate of return. I know in other situations economic changes the meaning of a term so it threw me off. Now that I read it again, I see how the other choices aren't correct. It's getting late and I'm being careless in my answers. Time to go to bed!

FAR: 4/19/2014 - 85!
AUD: 5/27/2014 - 90!
REG: 7/18/2014 - 81!
BEC: 8/13/2014 - 84!

4 up, 4 down, in 4 months.

Licensed 9/22 in NC.

[klink24]

@stoleway, I'm going with D because 40,000 = .25(40000) + 30000.

BESales = .25BESales + 30000

BESales – .25BESales = 30000

.75BESales = 30000

BESales = 30000/.75

BESales = 40000

Using a formula I know to algebraically solve the problem.

FAR: 4/19/2014 - 85!
AUD: 5/27/2014 - 90!
REG: 7/18/2014 - 81!
BEC: 8/13/2014 - 84!

4 up, 4 down, in 4 months.

Licensed 9/22 in NC.

[stoleway]

Correct.

REG -63│ 84!!
BEC- 59│70│ 71 │78!
AUD- 75!
FAR- 87!

Mass-CPA

[Anonymous]

D!! is it bad that it took me about 15 minutes to figure the problem out? :/

[Anonymous]

Getting through economics right now, and man there is a lot.. helps to keep my mind off waiting for that score…

[missjones513]

Going to start studying for my 5th shot at taking BEC. Starting the sections I was weaker on. I have 24 days and I going to try to make good use of them. I'm so over this section and I'm always so close to passing.

REG - 5/29/12 (64), 10/1/12 (74), 5/20/13 (75, expires 12/31/14)
FAR - 8/14/12 (64), 8/5/14 (75)
BEC - 11/19/12 (70), 2/25/13 (72), 11/21/13 (73), 1/21/14 (73), 8/30/14 (72), 11/24/14 (75)
AUD - 4/22/13 (65), 10/12/13 (79)

I'm done!!!

Ethics - Pass

[M.O.D.]

What is expected capacity?

Normal capacity

Practical capacity

Maximum capacity

Which should be used to establish overhead rates?

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)

[stoleway]

Practical capacity? I would have chosen “attainable” if it was an option..haha

REG -63│ 84!!
BEC- 59│70│ 71 │78!
AUD- 75!
FAR- 87!

Mass-CPA

[stoleway]

The Seeger Corporation is considering beginning to use “concentration banking.” What does that indicate?

A Seeger will borrow money only from one banking company in order to get a lower rate.

B Seeger will instruct its customers to mail payments to a bank in their local area rather than to its headquarters.

C Seeger will maintain all checking and other accounts in only one bank in order to gain more interest income.

D Seeger will begin to serve as its own banker for most transactions to reduce the amounts paid for service charges.

REG -63│ 84!!
BEC- 59│70│ 71 │78!
AUD- 75!
FAR- 87!

Mass-CPA

[SIR AGE]

AUD: 5/27 82!
FAR: 7/3 80!
REG: 7/21 76!
BEC: 8/8 78!

[missjones513]

B

REG - 5/29/12 (64), 10/1/12 (74), 5/20/13 (75, expires 12/31/14)
FAR - 8/14/12 (64), 8/5/14 (75)
BEC - 11/19/12 (70), 2/25/13 (72), 11/21/13 (73), 1/21/14 (73), 8/30/14 (72), 11/24/14 (75)
AUD - 4/22/13 (65), 10/12/13 (79)

I'm done!!!

Ethics - Pass

[Author]

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