[jeff]

Welcome to the Q2 2015 CPA Exam Study Group for BEC.

Economic Cycles (All Across the Land)https://www.another71.com/economic-cycles-rap/

Posted by Another71 on Thursday, November 6, 2014

Free NINJA: https://www.another71.com/cpa-exam-study-plan/

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

[rp 12]

Hello fellow Ninja's,

I am using Gleim for BEC and in Standard Costing unit, I am not able to follow/understand the solution for this MCQ.

The following direct labor information pertains to the manufacture of product Glu:

Time required to make one unit = 2 direct labor hours

Number of direct workers = 50

Number of productive hours per week, per worker = 40

Weekly wages per worker = $500

Workers’ benefits treated as direct labor costs = 20% of wages

QUESTION:

What is the standard direct labor cost per unit of product Glu?

Solution:

The hourly wage per worker is $12.50 ($500 ÷ 40 hrs.). The direct labor cost per hour is $15 [$12.50 × (1.0 + benefits equal to 20% of wages)]. Consequently, the standard direct labor cost per unit is $30 ($15 × 2 hrs.).

I cannot understand how $15 was derived. Can someone please help me explain this question?

"Success in life comes when you simply refuse to give up, with goals so strong that obstacles, failure, and loss act only as motivation"

AUD: 68, 62, 77✔ (expires 10/31/16)
FAR: 53, 48, XX (retake 6/16)
REG:
BEC: 53

[pfitz092]

@rp 12

You say “Workers’ benefits treated as direct labor costs = 20% of wages”

The $15 is simply the 12.50 hourly wage ($500 a week divided by 40 hours a week) multiplied by 1.2 to add the 20% of benefits. The problem states that in addition to workers' hourly wages, direct labor includes benefits that are equal to 20% of hourly wages. So simply add 20% (by multiplying by 1.2).

Then you just double the $15 to get $30 since each unit takes 2 hours complete.

[Troblin]

@Tscape thanks. Thanks, that was helpful.

FAR: 85(11/22/2014) - Becker(full)/Ninja MCQ (5 day cram)
AUD: 79 (2/1/2015) -Becker/Ninja MCQ/Ninja Notes
REG: 84(4/19/2015) -Becker/Ninja MCQ/Ninja Notes
BEC: 83 (7/13/2015) -Becker/Ninja MCQ/Ninja Notes

Date I Got My Life Back!: 8/4/2015 🙂

[Anonymous]

@Trobin I'm impressed at the pace you're going through these exams and scores! I'm struggling with FAR and I noticed that you used Ninja 5 day cram. Can you please tell me what that is? I'm studying BEC now then going back to FAR. Would you mind sharing your study techniques? How much time are you spending on BEC?

[Troblin]

@Arkansas Thanks!

There is no 5 day cram material for purchase. I purchased the Ninja MCQ 5 days before my exam, and was craming them day-in and day-out, hence the “5-day cram”. 🙂

I just finished Chapter 3 and have studied maybe 25 hours for BEC thus far. I don't think that I have an study habits that are that crazy.

Typically I'll do the following:

1) Watch/Read/Do the homework for Becker Chapter 1. Typically I'll score pretty poorly on some of the more difficult chapters (think I was trending at like 55% for BEC Chapter 2)

2) After I complete the 3rd chapter, I will conduct a summary review of Chapter 1-3. This usually involves reading the chapter, scanning the homework for the more difficult problems and taking notes on the areas that are causing me issues . I complete this process for every 3 chapter block.

3) After I have complete the initial and summary review of the chapters, I will peruse through the simulations/written communications to get a feel for them and take notes if necessary.

4) I start plugging through the Ninja MCQ non-stop. Again taking notes of any tricky/difficult questions that I encounter. I'll typically do this all the way up until exam day, with a strong empasis on reviewing the notes that I have compiled throughout.

Ultimately, I think this test just comes down to dedication. I don't consider myself particularly smart, but I do have a great work ethic/drive. I think if you put the time in, you should be able to pass no problem.

Lastly, FAR is just a beast. I studied 3 1/2 months straight for that test. I'd put my total study time at somewhere in the 250-300 hours range and I still came out of it shaky. My main motivation for BEC is to NOT have to take that monstrosity again…

FAR: 85(11/22/2014) - Becker(full)/Ninja MCQ (5 day cram)
AUD: 79 (2/1/2015) -Becker/Ninja MCQ/Ninja Notes
REG: 84(4/19/2015) -Becker/Ninja MCQ/Ninja Notes
BEC: 83 (7/13/2015) -Becker/Ninja MCQ/Ninja Notes

Date I Got My Life Back!: 8/4/2015 🙂

[Anonymous]

@Troblin Thank you so much for taking the time to respond! BEC Chapter 2 is tough! I did a review after chapter 3 too. I'm on chapter 5 now. I plan to take the last week of May off work so I can really study and hopefully pass BEC in first attempt. Good Luck to you but I'm sure you will do fine!

[rp 12]

Hello fellow ninja's,

I am scheduled to take my BEC on 7/10/15, and am using Gleim for this part. I am not doing that great in MCQ's. I have moved past Cost Accounting units (coming back later). Currently am in Operating Budget part. Am just finding it difficult to solve quantitative MCQ's and just to do 10 out of 38 MCQ's took me 1hr 45 mins, and am still not feeling confident with my understanding of this concept. Is this kind of normal during first round of MCQ's? Or it is just me struggling to understand? What did you guys do to overcome this part of BEC? I personally don't think BEC is easy.

"Success in life comes when you simply refuse to give up, with goals so strong that obstacles, failure, and loss act only as motivation"

AUD: 68, 62, 77✔ (expires 10/31/16)
FAR: 53, 48, XX (retake 6/16)
REG:
BEC: 53

[Tscape16]

@rp 12

I can't speak specifically for Gleim; however, a consistent trend among review programs is to learn from your mistakes. Take the time to understand why you got the problem wrong before moving on and you'll be fine. As mentioned above, reviewing in increments instead of the entire workload is a key to success.

FAR - 90 ✔
BEC - 86 ✔
REG - 82 ✔
AUD - 92 ✔
ETHICS - Passed

*Licensed CPA

[Troblin]

@rp 12 the cost accounting/variance analysis questions are very difficult IMO. Sometimes it takes me like 10 minutes of reading the solutions to even understand them.

FAR: 85(11/22/2014) - Becker(full)/Ninja MCQ (5 day cram)
AUD: 79 (2/1/2015) -Becker/Ninja MCQ/Ninja Notes
REG: 84(4/19/2015) -Becker/Ninja MCQ/Ninja Notes
BEC: 83 (7/13/2015) -Becker/Ninja MCQ/Ninja Notes

Date I Got My Life Back!: 8/4/2015 🙂

[rp 12]

@Troblin – same here too. It is my very first time with BEC like many others. Should I just move on after 1st attempt of HW MCQ's and when I come back for round 2 of MCQ's it will start making sense?

"Success in life comes when you simply refuse to give up, with goals so strong that obstacles, failure, and loss act only as motivation"

AUD: 68, 62, 77✔ (expires 10/31/16)
FAR: 53, 48, XX (retake 6/16)
REG:
BEC: 53

[nw123]

Can someone please help me understand why A is not the correct answer?

Based on potential sales of 500 units per year, a new product has estimated traceable costs of $990,000. What is the target price per unit to obtain a 15% profit margin on sales using the traditional markup calculation

A. $2,329

B. $2,277 Correct

C. $1,980

D. $1,935

If I sell 500 units @ 2,329 sales = 1,164,500 less 990,000 = 174,500. 174,500/1,164,500 = .15. What am I missing?

Thanks in advance

[Anonymous]

@nw123

The $990,000 total costs for the 500 products is your breakeven costs. So the 15% is your safety margin above your breakeven amount. I calculated the $2,277 price per unit below:

First – Take Break Even (Total direct costs which are the Variable and Fixed cost). Multiply it by the 15% Profit Margin (or safety margin). Then add the break even amount to safety margin giving you the total profit you will need for the year and divide it by the 500 units that will be produced for the year.

So: $990,000 x 15% = $148,500 + 990,000 = $1,138,500 / 500 units = $2,277 sales price per unit to obtain a profit (safety) margin of 15%.

Hope this Helps!

[Anonymous]

Hi Everyone!

I have one more week until my exam (May 24th) and I am only 30% done with the Adaptive Learning on NINJA multiple choice as of now. I plan to keep studying the adaptive learning through Sunday night but I was wondering if I should switch to the Blitz for the last 6 days before my exam or keep working on the Adaptive questions? I have never used the Blitz before so I was wondering if it would be okay to use even if I haven't gone through all of the NINJA questions.

Thanks in Advance for all input!

[CM]

Can someone please explain to me how is that a difference of 3 yens translate into 12 yen? I'm been having a hard time understanding this. I Google it, and I still don't understand it. I can see that 12 yens = 10% of 120 yens, but how do I get the 12 yen difference.

One United States dollar is being quoted at 120 Japanese yen on the spot market and at 123 Japanese yen on the 90-day forward market, hence the annual effect in the forward market is the:

A. United States dollar is at a premium of 10%.

Incorrect B. United States dollar is at a premium of 2.5%.

C. United States dollar is at a discount of 10%.

D. Japanese yen is at a discount of 2.5%.

The difference between the spot market and 90-day forward market price of a dollar in terms of yen, is 3 yen. Over a 360-day year, this 90-day difference of 3 yen translates into 12 yen, which is 10% of the spot market quote of 120 yen. The forward market quote is higher than that in the spot market, hence it is expected that the dollar will appreciate, and the U.S. dollar is at a premium of 10%.

FAR: 78 (5x)
AUD: 80 (3x)
BEC: 9/07/2016
REG: 12/06/2016

Failure is never an option.

"Faith in your own powers and confidence in your individual methods are essential to success." Roderick Stevens

[Anonymous]

How do we classify INSPECTION COSTS/EXPENSES out of the two Conformance Costs?

My notes say:

One of the Prevention Cost examples:

-Inspection Expenses

One of the Appraisal Cost examples:

-Inspection

Thanks!

[Author]

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