[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

[Anonymous]

So I think the Starting JE should be this and I think its here I made the mistake but not sure what I did incorrect..

Jan 1 Y1

DR Cash 940,000

DR Discount 10,000

DR BIC 50,000

CR BP ……1,000,000

Ahhh – see Stoleway and Anna posted it.. My BIC treatment wasn't correct.. OK got it!

[Anonymous]

@kenada, i think your original j/e is correct, ( or at least becker seems to say so in the bonds chapter).

[Anonymous]

Under GAAP – Bond Issue Costs do not reduce the Carrying Value of the investment like they do in IFRS. think of them as separate, and in my journal entries for Bond Issue costs, I do 2 separate entries (For GAAP), just to get it in my head that under GAAP, bond issue costs do not affect the amt of the discount.

DR – Cash ……………………….940,000

DR – Discount …………………….60,000

CR – Bonds Payable

---

1,000,000

DR: Bond Issue Cost……………..50,000

CR: Cash – BIC ……………………………….50,000

Disclaimer – I don't think this is correct/incorrect, just how my brain thinks about it.

[Anonymous]

@ allie, if u look at becker page f5-37. the example doesnt include any credit to cash for bic….

[Anonymous]

but it does decrease the discount

[Anonymous]

Can someone explain why the expected return on plan assets is used in this equation rather than the actual return?

https://puu.sh/92uXk.png

Isn't the actual return the only portion that actually impacts the funded status (plan assets)? Isn't the expected return something that impacts OCI and pension expense?

For example, taking this from my Wiley textbook.

If expected return was 13,410, actual was 12,000, leaving an unexpected loss of 1,410 then:

Actual Return:

Dr. Plan Assets 12,000

Cr. Pension expense 12,000

Unexpected loss:

Dr. OCI 1,410

Cr. Pension expense 1,410

[Anonymous]

Shoot you're right. I am messing up. The next page shows IFRS and shows the bond issue costs increasing the discount too…

[Anonymous]

ya im also having some issues with these bic questions, especially when it comes to IFRS..

[Anonymous]

Oh but I think what they are doing is netting the cash entry – see how on page 37, the Cash Debit is for $930,000 v. 980,000? So they are netting the CR: of Cash related to the bond issue cost with the DR: of Cash related to the issuance (980,000)

So they just combined my two separate entries into one.

[Anonymous]

hmm the way i understood it was that if the questions says they are issuing bonds for 980 with a 50 BIC, then its not really 980 for the bond issuance, really they are issuing the bond at 930 PLUS a separate cost that is amortized using S/L. so whenever i see a question like that i always start by subtracting the BIC from the amount recieved

[Anonymous]

in your J/E”s u had recorded the discount at 60000 tho

[Anonymous]

The JE's I made were for the multiple choice problem you originally posted. If I were to make JE's in my head for the Becker Example, it would look like —

DR: Cash……………980

DR: Discount………..20

CR:.Bonds Payable………..1000

DR: Bond Issue Cost……50

CR: Cash – BIC ………………….50

So overall – as the example in Becker shows:

DR: Cash ………….930

DR: Discount……….20

DR: BIC………………50

CR: Bonds Payable……………1000

Again, this is just how my brain thinks through BIC 🙂

[Anonymous]

ahhh ya that does make sense !

[willpassby2014]

Nota quitter…here you go

Because the first goods acquired are not impacted by subsequent purchases, FIFO systems always arrive at the same cost of goods sold and inventory figures regardless of whether a perpetual or a periodic system is in use (thus, answer A is true but B is not). In a periodic LIFO system, cost of goods sold is not determined until the very end of the period so that all purchases made last (at the end of the year) are assigned to cost of goods sold (answer C is true). Finally, in a period of cost inflation, as is seen here, LIFO provides lower figures for the inventory account because the most recent purchases are assigned to cost of goods sold (answer D is true)

BEC Passed
FAR Passed
AUD Passed
REG Passed

[Anonymous]

ahhhhh I don't know if I should quit at some point or just keep going. My test is at 9am tomorrow. Ive done a million progress tests all day and have been getting repeat answers. I am going to eat dinner, go through my flash cards, and call it a night?

AHH IM SO NERVOUS

[Author]

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