[jeff]

Welcome to the Q1 2016 CPA Exam Study Group for BEC.

Some BLITZ videos to help your exams: https://www.another71.com/ninja-blitz

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

[Zyx]

During the recessionary phase of a business cycle:

A.the purchasing power of money is likely to decline rapidly.

B.the natural rate of unemployment will increase dramatically.

C.potential national income will exceed actual national income.

D.the real rate of interest will exceed the nominal rate of interest

The answer is C. Why A or B is not correct??? I think unemployment rate increases during recession as well.

REG: 77 x2
BEC: 81 x3
FAR: 68 retake 10/1
AUD: 8/27

[FAR_WARS]

Answer (a) is incorrect because purchasing power is not directly related to business cycles.

Answer (b) is incorrect because in a recession it is cyclical unemployment that is high, not natural unemployment.

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

[payaza2000]

Yeah the answer is D.

FAR 5/6/2015- 84
REG 8/3/2015 - 87
AUD 10/25/2015- 69 1/20/2016 -75
BEC 2/26/2016- 80

Thank you God

[payaza2000]

Ryan Co. projects the following monthly revenues for next year:

January $100,000 July $250,000
February 500,000 August 275,000
March 425,000 September 300,000
April 450,000 October 350,000
May 575,000 November 400,000
June 300,000 December 525,000
Ryan's terms are net 30 days. The company typically receives payment on 80% of sales the month following the sale and 17% is collected two months after the sale. Approximately 3% of sales are deemed bad debt. What amount represents the expected cash collection in the second calendar quarter of next year?

A.
$1,450,000

Correct B.
$1,393,750

C.
$1,325,000

D.
$1,234,250
Question #: 950 Category: 5C2 Forecasting and Projection

If the answer is asking for Cash collections in the second quarter, I can understand why we include February and March. But why wouldn't we include May & June. This one got me, can anyone help me better understand it? Below NINJA explanation.

17% February Sales = $500,000 x 0.17 = $ 85,000
97% March Sales = $425,000 x 0.97 = 412,250-> Wouldn't this be 80%
97% April Sales = $450,000 x 0.97 = 436,500
80% May Sales = $575,000 x 0.80 = 460,000
———-
Total 2nd Quarter Collections $1,393,750

FAR 5/6/2015- 84
REG 8/3/2015 - 87
AUD 10/25/2015- 69 1/20/2016 -75
BEC 2/26/2016- 80

Thank you God

[monikernc]

Payaza, Second quarter is April, May and June and 3% is uncollectible meaning only 97% of any one month's sales will be collected. They receive no money for the current month's sales in the current month. They will collect 80% of this month's sales, next month and 17% in two months.
So, second quarter collections start in April and they collect 80% of March and 17% of Feb
In May, they collect 80% of April and 17% of March
In June, they collect 80% of May and 17% of April
July starts the third quarter, when they will collect 80% of June and 17% of May. The question is not asking for these amounts.
Take a breath and read the question and solution again and work through the numbers. Don't let being wrong throw you off. Concentrate on understanding the correct solution. BEC will beat you up if you focus too much on being wrong rather than letting it teach you how to do it right.

FAR 7/25/15 76!
AUD 10/30/15 93
BEC 2/27/16 82
REG 5/23/16 88!
Ninja Book and MCQ and the forum - all the way!!!
and a little thing i like to call, time and effort!
if you want things to change, you have to do something different

[payaza2000]

@monikernc

Thanks this actually really helped. I should be banging my head against the wall because this i think is one of the “easy ones” if I just read through it carefully.

FAR 5/6/2015- 84
REG 8/3/2015 - 87
AUD 10/25/2015- 69 1/20/2016 -75
BEC 2/26/2016- 80

Thank you God

[Anonymous]

Working on variance analysis AGAIN. Does anyone have a comprehensive list of all the different variances we should know how to calculate? (I think we were going back and forth earlier in the study group about it but not sure we ever came up with a final list.)

Thanks so much and for those of us studying tonight, I hope it is going well!

[Anonymous]

@payaza, congrats! We are in the same boat with just one more left! When are you testing?

[FAR_WARS]

To the best of my knowledge, every variance to know for the BEC exam:

1) DM Price
2) DM Efficiency
3) DM Total

4) DL Price
5) DL Efficiency
6) DL Total

7) variable OH spending
8) variable OH efficiency

9) fixed OH spending
10) fixed OH efficiency

11) Flexible budget
12) Sales price

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

[payaza2000]

I would recommend (not that I know for sure but ) knowing the DM Variance, DL Variance, O/H Variances, and being able to identify where the variance is coming from (efficiency/spending.).

FAR 5/6/2015- 84
REG 8/3/2015 - 87
AUD 10/25/2015- 69 1/20/2016 -75
BEC 2/26/2016- 80

Thank you God

[Anonymous]

@ FAR WARS, thank you! That is exactly what I was looking for!

[FAR_WARS]

Can someone confirm that:
DL Price variance = DL rate variance?
DL usage variance = DL efficiency variance?

also are there 2 variances for Flexible Budget
-Flexible Budget- fixed
and
-Flexible Budget- variable?

to add:
“Market Share Variance”
“Sales Volume Variance”
“Production Volume Variance”
“Static budget variance”?

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

[Zyx]

@ FAR_WARS, thanks!

REG: 77 x2
BEC: 81 x3
FAR: 68 retake 10/1
AUD: 8/27

[monikernc]

my exam is 3 weeks from today – let's see what i can do with 3 more weeks of studying
i know i can become more boring to my friends and family and continue to test my dog's loyalty but let's just see if i can get closer to my goal of passing this beast of an exam
Maybe, just maybe, I will learn to capitalize and punctuate properly.

FAR 7/25/15 76!
AUD 10/30/15 93
BEC 2/27/16 82
REG 5/23/16 88!
Ninja Book and MCQ and the forum - all the way!!!
and a little thing i like to call, time and effort!
if you want things to change, you have to do something different

[Anonymous]

For variances I am starting to understand the formulas but I am having trouble with interpreting their diagrams…. I do not know if its only me but I feel that BEC has so many random things, its making me feel like I am unable to have a solid “ground” on concepts.

[Author]

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