[jeff]

I’ve had a few requests for April/May Study Groups…March will be here before you know it.

In order to take an early April exam, you should begin studying…now. 🙂

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

[SpartanCPA]

$10,000 is correct!

AUD - 01/18/14 - 81
BEC - 05/29/14 - 85
FAR - 07/18/14 - 81
REG - 11/18/14 - 80

Becker CPA Review
NINJA Audio
Michigan State University

[jasbeerch]

Hey Everyone

All the questions you people are posting /quizzing is helping me a lot.

Thanks for all the questions and explanations too!!!

My exam is on 10th Apr. I did wiley questions only once (still Taxes and CF's remaining).

I have only 10 days now. What should be my strategy? Plz suggest.

Exam is for 4 hours. How you people are dividing the time between 3 testlets and 7 sims?

I am planning to read NINJA notes everyday and do some questions randomly from wiley.

Please give some suggestions.

thanks once again :)))

[jrosen92770]

How did you get $10k?

BEC - 5/26/2013 75
REG - 8/31/2013 82
AUD - 11/24/2013 74, 2/9/2014 92
FAR - 5/25/2014 85

NY CPA

[jasbeerch]

actually need some confidence boosting tips…………….plz suggest…..

[SpartanCPA]

@jrosen

Dr: Income tax expense $8,000

Dr: Deferred tax asset $5,000

Cr: Income tax payable $13,000

Ending deferred tax asset is $20,000 and it looks like we cannot realize 10% of it, so the $2,000 tax benefit that won't be realized increases our income tax expense by $2,000.

Dr: Income tax expense $2,000

Cr: Valuation account $2,000

AUD - 01/18/14 - 81
BEC - 05/29/14 - 85
FAR - 07/18/14 - 81
REG - 11/18/14 - 80

Becker CPA Review
NINJA Audio
Michigan State University

[jrosen92770]

Thanks Spartan. For my own thought process, so the $8k is a plug and then since we have a 10% more likely than not, we need to reduce the deferred tax asset from $20k to $18k.

BEC - 5/26/2013 75
REG - 8/31/2013 82
AUD - 11/24/2013 74, 2/9/2014 92
FAR - 5/25/2014 85

NY CPA

[SpartanCPA]

That's correct. If we are uncertain that a deferred tax asset benefit is not going to be realized, we need to set up a valuation the account. Because the tax benefit is not realized, our income tax expense increases.

AUD - 01/18/14 - 81
BEC - 05/29/14 - 85
FAR - 07/18/14 - 81
REG - 11/18/14 - 80

Becker CPA Review
NINJA Audio
Michigan State University

[jrosen92770]

Confidence tips, for me, during my review I try not to time myself. Note of course we have to average 1.5 minutes or less per MCQ so we enough time to answer the SIMS. Also, most people may not agree, but I have yet to do a final exam. I do multiple progress questions instead.

BEC - 5/26/2013 75
REG - 8/31/2013 82
AUD - 11/24/2013 74, 2/9/2014 92
FAR - 5/25/2014 85

NY CPA

[jrosen92770]

Ace Co. sold to King Co. a $20,000, 8%, 5-year note that required five equal annual year-end payments. This note was discounted to yield a 9 % rate to King. The present value factors of an ordinary annuity of $1 for five periods are as follows:

8%

3.992

9%

3.890

What should be the total interest revenue earned by King on this note?

BEC - 5/26/2013 75
REG - 8/31/2013 82
AUD - 11/24/2013 74, 2/9/2014 92
FAR - 5/25/2014 85

NY CPA

[stoleway]

Ok this is how I understand it.

You have a begining DTA of 15000 and ending $20,000. DTA increased by 5000 which will decrease your total tax expense.

But after doing this adjustment, you said to yourself, wait a minute….10% of the 20,000 that I have included in the tax expense above will not be realised, so in order not to have problem with Uncle Sam, Add that $2000 allowance back to your tax expense.

Current tax expense……$13000

Increase in DTA………….(5000) remember DTA increase will reduce your tax expense

Valuation Allowance……..2000

=$10,000

REG -63│ 84!!
BEC- 59│70│ 71 │78!
AUD- 75!
FAR- 87!

Mass-CPA

[stoleway]

@jrosen92770

$5,561?

REG -63│ 84!!
BEC- 59│70│ 71 │78!
AUD- 75!
FAR- 87!

Mass-CPA

[jrosen92770]

Yes.

$20,000/3.992=5010 Payment Per Year

5010*5 = $25,050

5010*3.89 (discounted) = 19,489

Interest = $5,561

BEC - 5/26/2013 75
REG - 8/31/2013 82
AUD - 11/24/2013 74, 2/9/2014 92
FAR - 5/25/2014 85

NY CPA

[jrosen92770]

The following is Gold Corp.'s June 30 trial balance:

Cash overdraft

$ 10,000

Accounts receivable, net

$ 35,000

Inventory

58,000

Prepaid expenses

12,000

Land held for resale

100,000

Property, plant, and equipment, net

95,000

Accounts payable and accrued expenses

32,000

Common stock

25,000

Additional paid-in capital

150,000

Retained earnings

83,000

$ 300,000

$ 300,000

Additional Information:

Checks amounting to $30,000 were written to vendors and recorded on June 29, resulting in a cash overdraft of $10,000. The checks were mailed on July 9.

Land held for resale was sold for cash on July 15.

Gold issued its financial statements on July 31.

In its June 30 balance sheet, what amount should Gold report as current assets?

a.

$125,000

b.

$195,000

c.

$205,000

d.

$225,000

BEC - 5/26/2013 75
REG - 8/31/2013 82
AUD - 11/24/2013 74, 2/9/2014 92
FAR - 5/25/2014 85

NY CPA

[stoleway]

Answer is $225,000

Cash

$20,000 (30,000-10,000)

Accounts receivable, net

$ 35,000

Inventory

58,000

Prepaid expenses

12,000

Land held for resale

100,000

REG -63│ 84!!
BEC- 59│70│ 71 │78!
AUD- 75!
FAR- 87!

Mass-CPA

[jrosen92770]

Normally land would be non-current correct, but since it's held for resale its current, correct?

BEC - 5/26/2013 75
REG - 8/31/2013 82
AUD - 11/24/2013 74, 2/9/2014 92
FAR - 5/25/2014 85

NY CPA

[Author]

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