[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

[ChristieF]

Well – I'm glad I just started on Leases… definitely need MORE study time on that subject 🙂

[NJPRU]

Frosty – I'll be starting leases tonight as well. 🙂

AUD: DONE
FAR: DONE
BEC: DONE
REG: DONE

IM GOING TO BE A CPA!!!!!

[stoleway]

Question: 2 Orlean Co., a cash-basis taxpayer, prepares accrual-basis financial statements. In its current-year balance sheet, Orlean’s deferred income tax liabilities increased compared with those reported for the prior year. Which of the following changes would cause this increase in deferred income tax liabilities?

I.An increase in prepaid insurance

II.An increase in rent receivable

III.An increase in warranty obligations

A. III only.

B. I and II only.

C. II and III only.

D. I only.

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

Mass-CPA

[How many letters do you need]

Frosty: Obviously me too! One week until exam day and I need to button down little things like that..

I feel like I killed just enough brain cells in Vegas this weekend to make room for little tidbits like that. I really do feel refreshed and ready to take on a power week that will rival all power weeks. Doing 5 hours a day through Friday, 10 on Sat and Sun. Final notes are set so the plan is all MCQs, a few sims and memorization on anything that's still not sticking. Let's go everybody go go go go!!

MBA,CMA,CPA, CFF?, ABV?

[ChristieF]

[Anonymous]

Did not even think about the fact that a high discount rate would give you a lower PV amount. Geesh–Thanks for that question!

[klink24]

@stoleway, I'm going to go with B. I'm struggling a bit with deferred taxes so trying to get them down. My rationale is that right now for I and II Book Income > Tax Income. Later, Tax Income > Book Income so there will be more taxes to pay, hence the liability. For II, the reverse is happening. Right now, Tax Income > Book Income meaning later Book Income > Tax Income. There will be less in taxes to pay, hence the asset.

Hope I'm right!! I was bombing on my deferred tax quizzes last night.

FAR: 4/19/2014 - 85!
AUD: 5/27/2014 - 90!
REG: 7/18/2014 - 81!
BEC: 8/13/2014 - 84!

4 up, 4 down, in 4 months.

Licensed 9/22 in NC.

[How many letters do you need]

Stole- Def taxes twist me all around and I end up changing amswers 3 times but I think it's C.

MBA,CMA,CPA, CFF?, ABV?

[stoleway]

@nclynch

Correct

Answer (B) is correct.

An increase in prepaid insurance signifies the recognition of a deduction on the tax return of a cash-basis taxpayer but not in the accrual-basis financial statements. The result is a temporary difference giving rise to taxable amounts in future years when the reported amount of the asset is recovered. An increase in rent receivable involves recognition of revenue in the accrual-basis financial statements but not in the tax return of a cash-basis taxpayer. This temporary difference also will result in future taxable amounts when the asset is recovered. A deferred tax liability records the tax consequences of taxable temporary differences. Hence, these transactions increase deferred tax liabilities. An increase in warranty obligations is a noncash expense recognized in accrual-basis financial statements but not on a modified-cash-basis tax return. The result is a deductible temporary difference and an increase in a deferred tax asset.

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

Mass-CPA

[How many letters do you need]

Arefgfggffffgh damn you deferred taxes!!!

MBA,CMA,CPA, CFF?, ABV?

[stoleway]

@How many letters do you

Calm down, LOL. I was banging my head on the table when I was getting these pertinent questions wrong. OK, lets try this one.

Question: 4 Under IFRS, a deferred tax asset is

A. Measured by applying the tax rates effective when the asset is realized.

B. Recognized to reflect the deferred tax consequences of a taxable temporary difference.

C. Recognized to the extent that realization is probable.

D. Required to be reduced by a valuation allowance if it is more likely than not that some portion will not be realized.

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

Mass-CPA

[teeteenounouche]

D.

Florida:
AUD: 73, 81! Thank you Lord!
BEC: 73, 77! Thank you Lord! and WTB
REG: 71, 82! Thank you Lord! and A71
FAR: 72, 78! Thank you God and my Mommy in Heaven!

CPA Excel, Ninja Notes & Audio, Wiley Test Bank, CPAreviewforfree

[SpartanCPA]

D as well.

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

[Anonymous]

D also.

[stoleway]

Damn, it shows that my im not dumb after all…lol, I thought it was D as well.

Answer is C… Valuation is not allowed under IFRS

Answer (C) is correct.

Under IFRS, a deferred tax asset is recognized for most deductible temporary differences and for the carryforward of unused tax losses and credits, but only to the extent it is probable that taxable profit will be available to permit the use of those amounts. Probable means more likely than not. Thus, no valuation allowance is separately recognized under IFRS.

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

Mass-CPA

[Author]

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