[jeff]

Welcome to the Q2 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

[jessica8926]

They have to discount them to the present value to see if they should accept the project now. They are not making this decision in the future based off of future cash flows but are rather deciding in the present day thus you need present cash flows. Apples to apples is my thought.

Honestly though to save you some sanity and time I would tell you to move on haha. It sounds like you have the basic concept down and as long as you can calculate the PVFCFs you should be good 🙂 so stop torturing yourself and take a break!!

AUD - 69, 77
REG - 74, 81
FAR - 75!
BEC - 71, 82

IL candidate!

Finally done (5/24/16)!! Yahooooooo!

[jonnybgood2321]

thanks everyone

AUD-PASS
BEC-
FAR-
REG-

[treekachu]

@jonnybgood2321 good luck on Saturday and let us know how it goes! That conversation was helpful to me too, thanks guys 🙂

In my search for a good app to practice my own flashcards, I came across Memorang and they have a BEC flashcard set. Has anyone used it before? Of course they only display good reviews, so I wanted to check if there are any bad experiences before purchasing. The price is affordable enough that I’m thinking of using that and Ninja MCQs to go along w/ my book. Ahhh sooo much information to nail down! @.@

[Larry]

Not feeling very confident after tonight's review session. Dropped 2 percentage points down to 73. Switched from Becker to Ninja questions. Gosh, there's so many things to remember and I'm having Deja vu feeling like I'm studying for FAR

REG - 82
FAR - 78
BEC - 76
AUD - 8/27/16

[valorx28]

when you're making sure that the company is complying with the corporate policy…does that fall under Control Environment of CRIME? Or is that part of monitoring.

[Bear-Bear]

@Papogator24 – Ninja is killing me too, I'm at a tenuous 76 right now. That's funny…I thought the same thing after I finished the CPAExcel material and started Ninja: “Dude…BEC is like half the size of FAR…why does it seem like I have just as much to remember?” :-/

[MaLoTu]

@valorex- possibly, it would be the E existing controls, I.e., policies and procedures.

[Bear-Bear]

Dang, you guys have me questioning my acronyms. For internal control, I always used CRCIM (ok, i guess not an acronym technically…). What's CRIME? Or is that for ERM?

[Larry]

I agree with Malotu. That would fall under existing control activities. Monitoring is ongoing and separate evaluations.

Bear-Bear, for Becker, we have different mnemonics. For COSO, we have the CRIME and for ERM we have the IS EAR AIM.

C= Control Environment
R= Risk Assessment
I= Information and Communication
M= Monitoring
E=Existing Control Activities

For ERM we have:

I=Internal Environment
S= Setting Objectives (4) SORC

E= Event Identification
A=Assessment of Risk
R=Risk Response

A=Control Activites
I= Information and Communication
M=Monitoring

I guess the good thing is that I'm a month away from today for my test so I have more time to practice and memorize the abundant of formulas. Although, this is a conceptual exam, I feel like this exam is a sleeper that can catch you off guard.

REG - 82
FAR - 78
BEC - 76
AUD - 8/27/16

[mtaylo24]

Need help w/ this one from Financial Risk Management: Capital Asset Pricing Model.

Stock J has a beta of 1.2 and an expected return of 15.6%, and stock K has a beta of 0.8 and an expected return of 12.4%. What is the expected return on the market and the risk-free rate of return, consistent with the capital asset pricing model?

A. Market is 14%; risk-free is 6%.
B. Market is 12.4%; risk-free is 0%.
C. Market is 14%; risk-free is 4%.
D. Market is 14%; risk-free is 1.6%.

Answer is A but I am having trouble w/ the calculation.

AUD - 1st - 60 (12/12), 61 (2/13), 61 (8/13), 78! (11/15)
REG - 55 (2/16) 69 (5/16) Retake(8/16)
BEC - 71(5/16) Retake (9/16)
FAR - (8/16)

[MaLoTu]

Risk free rate + (beta *(market rate – risk free rate))

ETA: I would just plug the numbers into the equation… When you use the beta, mr, rfr it equals the expected values

[mtaylo24]

@MaLoTu Thanks. I guess I can't figure out how to solve for M first and getting the 14 mentioned in the answer explanation to plug into the formula. It should be simple math, but maybe I'm just being lazy.

Answer (A) is correct.
This problem requires the use of simultaneous equations. Set up a CAPM formula for each stock:

Stock J: 15.6 = RF + 1.2 (RM – RF)
Stock K: 12.4=RF + .8 (RM – RF)

Remove the parentheses and combine terms:

Stock J: 15.6=1.2RM – .2RF
Stock K: 12.4=.8RM + .2RF

Then solve for M. Add the two equations above, M = 14. Substitute 14 for M in the second equation:

12.4=RF + .8(14 – RF)

12.4=.2 RF + 11.2

1.2=.2 RF, or RF = 6

AUD - 1st - 60 (12/12), 61 (2/13), 61 (8/13), 78! (11/15)
REG - 55 (2/16) 69 (5/16) Retake(8/16)
BEC - 71(5/16) Retake (9/16)
FAR - (8/16)

[mtaylo24]

Oh nvm, i got it…im slow smh LOL. Thank you google

AUD - 1st - 60 (12/12), 61 (2/13), 61 (8/13), 78! (11/15)
REG - 55 (2/16) 69 (5/16) Retake(8/16)
BEC - 71(5/16) Retake (9/16)
FAR - (8/16)

[jonnybgood2321]

If anyone has NINJA MCQ for BEC and has access to the AICPA released questions that come with it, can you please look up #16? I keep getting .75 for the standard variable price and 400,000 for the budgeted hours I cant figure it out. Thanks.

AUD-PASS
BEC-
FAR-
REG-

[Larry]

Can you copy and paste the question jonny?

REG - 82
FAR - 78
BEC - 76
AUD - 8/27/16

[Author]

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