[jeff]

Welcome to the Q4 2016 CPA Exam Study Group for BEC.

If this is your first post in the study group – please post your target exam date (just the time frame to preserve your anonymity), and your past history with this exam (optional, of course).

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

[stina71223]

Hi all. I must be having a dummy moment.. Can someone please tell why the cost incurred is 55% of total cost incurred instead of 40%??

Kimbeth Manufacturing uses a process cost system to manufacture Dust Density Sensors for the mining industry. The following information pertains to operations for the month of May:
Units
Beginning work-in-process inventory, May 1
16,000
Started in production during May
100,000
Completed production during May
92,000
Ending work-in-process inventory, May 31
24,000
The beginning inventory was 60 percent complete for materials and 20 percent complete for conversion costs. The ending inventory was 90 percent complete for materials and 40 percent complete for conversion costs.
Costs pertaining to the month of May are as follows:
Beginning inventory costs are: materials, $54,560; direct labor $20,320; and factory overhead, $15,240.
Costs incurred during May are: materials used, $468,000; direct labor, $182,880; and factory overhead, $391,160.

Using the weighted-average method, the equivalent unit conversion cost for May is $6.00 ($35,560 beg. inv. + $574,040 additions = $609,600 ÷ 101,600 ) I understand the 101600 for equivalent units and 35560 for the beg inventory cost for materials.

Any help is appreciated!

[sonja90]

Johnson Co. is preparing its master budget for the first quarter of next year. Budgeted sales and production for one of the company's products are as follows:

Month Sales Production
——– ——- ———-
January 10,000 12,000
February 12,000 11,000
March 15,000 16,000
Each unit of this product requires 4 pounds of raw materials. Johnson's policy is to have sufficient raw materials on hand at the end of each month for 40% of the following month's production requirements. The January 1 raw materials inventory is expected to conform with this policy.

How many pounds of raw materials should Johnson budget to purchase for January?

A.
11,600

B.
46,400

C.
48,000

D.
65,600

[Abdulmajid]

its 22 November!!
only hours out to get my Score 🙁

I am literally nervous

[Determined24]

Hi Guys:

I am planning BEC for my next move, have REG in a few weeks.

Can anyone tell me, based on the BEC material can the NINJA 10 point Combo carry me to a pass for BEC? This is with no other review material.

[Determined24]

I need something smooth and can really help me nail the concepts, I find that I have to be googling to much to even understand what the review material is saying.

I work from 8 AM to 10 PM on weekdays with 1 hour or 45 minutes lunch break and the occasional bathroom breaks.

I hope to cover BEC in 6 weeks tops.

What would you recommend?

[Anonymous]

Stina I'm having a little trouble understanding the part you are confused about. Are you confused on how they're getting $574,040 for the additions? If that's what you're wondering. Conversion cost are Direct Labor + Manufacturing Overhead. So it'd be $182,880 + $391,160 = $574,040. That's the only part you didn't state you understood. If that doesn't answer your question, let me know.

[Anonymous]

Sonja, I don't even know where to begin on your first question. Lol.

I can answer your second one though.

It states that January will follow the production requirements, which means you can calculate the beginning inventory. So first the beginning inventory is 12,000 x .4 X 4(raw material per unit) = 19,200 pounds of raw material.

Then you have to calculate how many units you're going to produce in January in terms of raw material = 12,000 x 4 = 48,000 pounds of raw material.

Next is what is your desired ending inventory = 11,000 (February production) x .4 x 4(raw material per unit) = 17,600

Your equation should then look like this: 19,200(beginning inv) – 48,000(amount needed for January) + X (amount of raw materials to be purchased) = 17,600 (raw material desired ending inventory)

Simplified = X = 17,600 + 48,000 – 19,200

X = 46,400

That question is a bit confusing, and I'm not sure why the 2,000 of production over sales isn't applied towards next months desired ending inventory. But if you subtract out the 8,000 (2,000 x 4), it doesn't give you one of the answers provided. The only thing I can think of is spoilage? Hope that helps.

[Abdulmajid]

Hi there,,,
this is my first post here

I would share with you my suffering with my first section in my CPA jurney
I have sat for my first CPA exam on 20 April 2016, it was BEC section and I scored 33,
Then I have retaken the exam on 5 July and the score decreased to 24!
On 1st November, was my last and third attempt and I just checked my score now and unfortunately scored (65)! I am literally angry now !!
Please mindful that I study for every attempt at least two months using Roger’s Video Classes, Books, Cram Books, Ninja points and did 700 question before set for each exam.

Honestly, I most focus on MCQs and the books because I don’t think that I am visual learner and I am not native English speaker as well, I have watched 33% videos in BEC.
Anyway, my target now became to pass BEC and REG before the new version in next April,
Can you please help me guys with best advises to pass these two section as fourth time for BEC and first time for REG

My plan is to take BEC on 2 January and REG on 9 March, I really don’t have any background about taxation as there is no tax in our country and did not study that. Sometime I think to postpone REG until I don’t know! and concentrate on BEC to at least can pass one section before new version so take the BEC on last day ( 9 March ).

This time of studying BEC I will concentrate only on Ninja MCQs and beat 3000 extra question , only doing MCQs, do you think this working ? last time I have solved only 700 questions including review I think its not enough.

Please advise me people

Although I often failed with very low marks and always feel that I am hopeless, but I don’t want to give up.

Thx in advance

[melonbread]

Hi everyone!
I'm taking BEC on 28th and not sure if there's any chance for me…
I use becker and did the pre exam#1 a week ago, got 67%, 71%, 62% on each testlet.
I wanted to know how other people did on those pre exams and the actual exams so I looked at the spreadsheet someone had somewhere (it was something like “if you got a 63 on those you probably passed”)
But I wasn't sure how those stats were taken because you get 100% on WC whatever you write on the pre exams.
Are those figures on the spreadsheet overall scores with 100% on WC or are they just only MCQ based percentage?

[Determined24]

Hi @Abdulmajid

I am a CPA newbee, also an international, I am no CPA expert as I am just going to sit REG in an few weeks.

But I have a little newbee advice for you, from being in the forums and doing countless research on cpa study tips.

From what you wrote I believe you have a challenge with the English Language as you said as well as the concepts.

Same for me, I have a a challenge learning the concepts, because #1 I have no idea what they are referring to off hand,we use a different reporting system in our country.

How do I beat this challenge?

I Google and find simple ways of breaking down the material. I also try to find examples other than what is in the review system just to get a basic understanding this includes even writhing down definitions, synonyms anything to simplify.
Then I go back and apply it to the question in the review system.

You will need to give yourself time and patience as for us internationals there is a bit of learning curve, first we have to unlearn what we know from our country and if we know the background figure out how o flex it into our new studies.

Give yourself time to learn the material from scratch understand the concepts and write it down all the way.

I can tell you, not to scare you but REG will require a tedious level of concept understanding as an international with no US tax experience. This forum and Google is your new Facebook.

[Abdulmajid]

Hi determined 24

oh god how much you are helpful guy, I really appreciate your advises and definitely its valuable. I will do my best to follow your advise

but anyway, I became bit optimistic now because there is a big difference between my previous score (24) and now (65) so its 10 marks only to pass! and I have more than a month to working on that

after I set on January I will go home and start studying for REG and doing my best, if I pass it on 9 March I am gonna be happiest person in the world, if not ,,,,,, what can I do? this is not the world ends

thanks again bro

[Determined24]

🙂 you mean Sis @Abdulmajid

That is indeed a big improvement, so you are doing something right just need some more of it.

Also, really be patient with yourself…you are getting there.

I plan to do BEC January and really hoping for the best with REG

[Kbob]

BEC scheduled for 12/8. 16 days and counting.

Question on 1069 of Ninja MC:

Stem:

Jansen, Inc., pays bonuses to its managers based on operating income. The company uses absorption costing, and overhead is applied on the basis of direct labor hours. In order to increase bonuses, Jansen's managers may do all of the following, except:

Choices:

A.
defer expenses such as maintenance to a future period.

B.
increase production schedules independent of customer demands.

C.
decrease production of those items requiring the most direct labor.

D.
decrease production of those items requiring the least direct labor.

Correct answer: C

I have a block with this problem.

The goal is to reduce expenses and increase operating income. Okay. If that's true, I don't see how we can unequivocally say expenses will always be increased by decreasing production of units requiring high amounts of direct labor. I think it would depend on the product mix, sales level, and ending inventory level.

Argument: assume we produce a low-hours product and a high-hours product. The low-hours product requires 1 DLH; high-hours, 10 DLH. We produce 10 units of each. Total DLH are 110 (1 * 10 + 10 * 10). Fixed costs to allocate are $100,000, making each DLH $909.09 (100,000/110). If we sell everything, fixed portion of COGS is $100,000. However, if we reduce high-hours units by one, COGS decreases to $90,909, whereas if we leave high-hours units alone and instead decrease low-hours units by one, COGS decreases to $99,990. Result: in this example, a reduction of one unit of high-hours product has a far greater reducing impact on COGS than would a reduction of one low-hours product.

Ninja seems to suggest the opposite, unless I'm missing something, which is highly likely.

Reworking this problem with a different sales mix produces a different result, which is why I can't come up with a justification for Ninja's answer below:

“Managers will show lower operating income if they decrease production of those items requiring the most direct labor. The lower operating income results from the fact that a decrease in the production of items that require the most direct labor hours means that each of the items that is produced will have more fixed costs associated with it. The increase in fixed costs per item will reduce operating income.”

Why is this true?

[Kbob]

Think I figured 1069 out.

With fewer hours to allocate over the same fixed cost base, the dollars/DLH increases. On the other hand, with greater hours to allocate over the same fixed cost base, the dollars/DLH decreases.

Therefore, under the second scenario (greater hours), each hour assigned to COGS will be less valuable than the first scenario (fewer hours), resulting in lower COGS (on a per-hour basis) and higher operating income.

On the other hand, each hour assigned to COGS under the first scenario (fewer hours) would be more valuable than the second scenario, resulting in higher COGS (on a per-hour basis) and lower operating income.

I think this works, but if someone would proof it for me, I would appreciate it.

Thank you.

[Louie]

I got a bunch of Auditing questions when I took BEC in July. Did anyone feel that way?

[Author]

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