[jeff]

Welcome to the Q1 2017 CPA Exam Study Group for BEC. 🙂

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

[Sean DAVIS]

I just had bec today. All those IT question I have never see em on becker or ninja. I guess it's time for Willy.

[Fine]

Do we have to memorise all formulas in asset effectiveness and efficiency? Also, I would really appreciate any advices before taking the exam. Thank you all so much.

[distracted]

Is the exam still IT heavy?

[mooseonloose]

@Saleh, I would be on the safe side and memorize the formulas. You can never tell what they throw at you.

[Anonymous]

I'm having trouble with the overhead variance calculations…anyone got any tips??

[Anonymous]

For variances, the best way I found is this -price variance is the difference in price between actual and standard based on actual output. Efficiency variance is the difference between standard amount of materials of labor allowed vs. amount of labor or materials used at standard rates. Ninja MCQ has a great visual graph, I think those are the best to remember it by. Budget variance is the total of price and efficiency variance.

[mooseonloose]

What is the difference between a short term risk and long term risk?

[pharaoh]

How would you answer this and why?

During a meeting with the CEO of the Marble Company, Connie CPA learned that the son of the CEO had worked at the company during one summer doing odd jobs. The year in question was included in the past financial records being used as a basis for the business valuation for which Connie had been engaged. The payroll records revealed that the son had received $40,000 (including taxes and other benefits) for this summer work. Connie should make a normalization adjust for:

A. a nonoperating item for the full $40,000 received by the son.

B.a nonrecurring item for the full $40,000 received by the son since he only worked at the Mable Company for one summer.

C.a comparability item for $20,000 since it is not likely that guideline companies would have paid $40,000 for the work performed.

D.a discretionary item for $35,000 since the going market rate for the work performed by the son would have been $5,000.

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

[Theodore]

Can Someone tell me why depreciation is not considered in this equation?

A corporation is considering purchasing a machine that costs $100,000 and has a $20,000 salvage value. The machine will provide net annual cash inflows of $25,000 per year and has a six-year life. The corporation uses a discount rate of 10%. The discount factor for the present value of a single sum six years in the future is 0.564. The discount factor for the present value of an annuity for six years is 4.355. What is the net present value of the machine?
a.($2,405)
b.$8,875
c.$20,155
d.$28,875

FAR: 66, 76!
REG: 76!
AUD: 72, 9/7/2016
BEC: TBA

Don't Stop When You Are Tired, Stop When You Are Done.

[Fine]

@Rosy0407 it is considered because of the following calculation:
25000 * 4.355 = 108,875
20,000 * .564 = 11,280 ( since we only calculate this for the last period)
so add them together gives you 120,155 – 100,000 = 20,155 NPV.

I am not really good at explanation in writing but i hope this helped.

[Theodore]

@Saleh I got the correct answer. I just didn't realize that the questions states “net operating cash inflows” this would include the depreciation tax shield. correct?

FAR: 66, 76!
REG: 76!
AUD: 72, 9/7/2016
BEC: TBA

Don't Stop When You Are Tired, Stop When You Are Done.

[Krakebo007]

Hi everyone I just started my second attempt to pass BEC exam on March,8 2017
I still shocked after failing in my first attempt on Nov,19 2016
I've got score of 50 !! I can't believe it !!
It wasn't so hard at all and I thought i did well in most of exam parts
Even in written communication section it was familiar to me
However corporate governance,IT comunications were heavily tested in the exam
but I was well prepared for those parts.
Anyway I'll start again and nothing will stop me till I beat this monster
Even I have a busy season and not much time for studying well
Good luck for all

Journey started 15-08-2015
BEC 01-10-2015
FAR 29-11-2015
AUD 03-01-2016
REG 29-02-2016

[mooseonloose]

I have less than two weeks and my Ninja actual score is 68..uggghhh

[mooseonloose]

The Jones Company is considering using a lockbox system. The company has gathered the following information:

The per-check processing cost will be $0.20.
The days saved in the collection process will be 1.2 days.
The average size of the check will be $1,000.
If funds are freed, they could be invested at a 5% annual rate.
On average, 150 checks will be processed per day.
Should the Jones Company adopt the lockbox system, and why or why not?

A.Yes, since the company can earn 5% on the funds that are freed up

B.Yes, since the company will save $5 a day over their current collection process

C. No, since the benefit to the company is $0.17 per check processed

D.Yes, since the benefit to the company is $0.17 per check processed

I don't get this questions. Shouldn't the answer be “D” instead of “C”? The current cost is .20..isn't .17 better?

[cpaswag]

SO LOST…. I know actual won't be like this but please explain :
Garth has a line of credit of up to $4 million, on which it pays interest monthly at a rate of 1% of the amount utilized. Garth is expected to have a cash balance of $2 million on January 1 and no amount utilized on its line of credit. Assuming all cash flows occur at the end of the month, approximately how much will Garth pay in interest during the first half of the year?
A.
$0
B.
$61,000
Incorrect C.
$80,000
D.
$132,000
Answer was B

[Author]

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