[jeff]

FAR Resources:

Free FAR Notes & Audio – https://www.another71.com/cpa-exam-study-plan

FAR 10 Point Combo: https://www.another71.com/products-page/ten-point-combo

FAR Score Release: https://www.another71.com/cpa-exam-scores-results-release

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

[Anonymous]

Great…I go through F1-F7 without much hassle and now I get to F8-Governmental (which is supposed to be easy for most) and I don't understand crap. Does anyone have any free online sites I could use to learn this stuff, because Becker is just terrible at teaching this and the NINJA notes are really just an overview. I need journal entries and natural balances of accounts badly…

[Anonymous]

Great…I go through F1-F7 without much hassle and now I get to F8-Governmental (which is supposed to be easy for most) and I don't understand crap. Does anyone have any free online sites I could use to learn this stuff, because Becker is just terrible at teaching this and the NINJA notes are really just an overview. I need journal entries and natural balances of accounts badly…

[Iwillpass20]

What is the most simplest way to answer this problem?

The State levies a 4% sales tax on merchant sales volume while the local government levies a 2% tax on the same activity. Merchants are required to remit the full amount of all levied taxes to the State government within 15 days of month end and the State is required to remit collected taxes to local authorities within 30 days of receipt. Assume the State and local authority had June 30 year-ends, and that sales volume for the months of June and July were $100,000 and $200,000, respectively. At June 30, each government would accrue the following related to sales activity:

State Local Government

Tax Revenue Payable Tax Revenue

a.$12,000 $4,000 $2,000

b.$12,000 $6,000 $2,000

c.$4,000 $2,000 $2,000

d.$12,000 $6,000 $6,000

Choice “c” is correct. Revenue due is recognized (accrued) in the period in which it is both measurable and available. The only difference between accrual basis recognition of financial resource inflows and modified accrual basis recognition of financial resource inflows relates to availability. “Available” is generally defined as collected within 60 days. Under the accrual basis of accounting, revenues are recognized when the underlying exchange transaction occurs.

June sales are relevant while July sales information, which pertains to a subsequent fiscal period, is a distracter. July taxes would not be accrued in the current period even though they are collected within 60 days of year-end in some cases. July taxes are not earned as of June 30.

[Iwillpass20]

What is the most simplest way to answer this problem?

The State levies a 4% sales tax on merchant sales volume while the local government levies a 2% tax on the same activity. Merchants are required to remit the full amount of all levied taxes to the State government within 15 days of month end and the State is required to remit collected taxes to local authorities within 30 days of receipt. Assume the State and local authority had June 30 year-ends, and that sales volume for the months of June and July were $100,000 and $200,000, respectively. At June 30, each government would accrue the following related to sales activity:

State Local Government

Tax Revenue Payable Tax Revenue

a.$12,000 $4,000 $2,000

b.$12,000 $6,000 $2,000

c.$4,000 $2,000 $2,000

d.$12,000 $6,000 $6,000

Choice “c” is correct. Revenue due is recognized (accrued) in the period in which it is both measurable and available. The only difference between accrual basis recognition of financial resource inflows and modified accrual basis recognition of financial resource inflows relates to availability. “Available” is generally defined as collected within 60 days. Under the accrual basis of accounting, revenues are recognized when the underlying exchange transaction occurs.

June sales are relevant while July sales information, which pertains to a subsequent fiscal period, is a distracter. July taxes would not be accrued in the current period even though they are collected within 60 days of year-end in some cases. July taxes are not earned as of June 30.

[UHC2005]

Looking at the problem, the $4000 would be considered revenue to the State as would the $2000 to the local government. However, because the state has a thirty day window to remit collected taxes to the local government, to me, it would be considered payable because the second half of the thirty day window would fall after year-end.

That is how I reason it out in my head and I could be completely wrong.

Using Ninja MCQ, NINJA Notes, Audio, Flashcards and BLITZ, and 2014 Wiley Text

FAR - (61,63)
AUD - (68)

Keep Calm and RTMFQ

Accountant, what is best in life? To crush your MCQs, see them driven before you, and hear the lamentation of their SIMS!

[UHC2005]

Looking at the problem, the $4000 would be considered revenue to the State as would the $2000 to the local government. However, because the state has a thirty day window to remit collected taxes to the local government, to me, it would be considered payable because the second half of the thirty day window would fall after year-end.

That is how I reason it out in my head and I could be completely wrong.

Using Ninja MCQ, NINJA Notes, Audio, Flashcards and BLITZ, and 2014 Wiley Text

FAR - (61,63)
AUD - (68)

Keep Calm and RTMFQ

Accountant, what is best in life? To crush your MCQs, see them driven before you, and hear the lamentation of their SIMS!

[zieba]

This suceesful defense of patent question is tripping me up, and I'm not sure whether this may be an error on Becker's part:

Hy bought patent A for $40K, and patent B for $60K. Acqusition costs for A were $5K and $7K for patent B. Both patents were challenged in court. Hy paid $20K in legal fees for successful defense for patent A and $30K for unsuccessful defense of patent B.

How much should Hy capitalize for patents?

a) 162

b) 112

c) 65

d) 45

patent A:

40K cap purchase

5K cap acq costs

20K cap legal fees successful

—-

total cap is 65K

patent B:

60K cap purchase

7K cap acqusition costs

30K expense legal fees ???

total cap for this is 67K

BECKER's answer is to capitalize 65K from patent A…. totally ignoring patent B?

I was under the impression that you expense unsuccessful defense costs… but the purchase price and acquisition of a purchased arms length patent… are still to be capitalized.

wonky wording or am I missing something?

Why 65K and not capitalize both 65K and 67K (leaving out the 30K for legal expense of patent B)

AUD - 75*, 88 done 5/14! (*exp)
BEC - 74 , 77
REG - 65 , 76 (10 point combooo!!)
FAR - 69 , 75

Dr: perseverance
Dr: intelligence
Dr: luck
. Cr: . advisory score

[zieba]

This suceesful defense of patent question is tripping me up, and I'm not sure whether this may be an error on Becker's part:

Hy bought patent A for $40K, and patent B for $60K. Acqusition costs for A were $5K and $7K for patent B. Both patents were challenged in court. Hy paid $20K in legal fees for successful defense for patent A and $30K for unsuccessful defense of patent B.

How much should Hy capitalize for patents?

a) 162

b) 112

c) 65

d) 45

patent A:

40K cap purchase

5K cap acq costs

20K cap legal fees successful

—-

total cap is 65K

patent B:

60K cap purchase

7K cap acqusition costs

30K expense legal fees ???

total cap for this is 67K

BECKER's answer is to capitalize 65K from patent A…. totally ignoring patent B?

I was under the impression that you expense unsuccessful defense costs… but the purchase price and acquisition of a purchased arms length patent… are still to be capitalized.

wonky wording or am I missing something?

Why 65K and not capitalize both 65K and 67K (leaving out the 30K for legal expense of patent B)

AUD - 75*, 88 done 5/14! (*exp)
BEC - 74 , 77
REG - 65 , 76 (10 point combooo!!)
FAR - 69 , 75

Dr: perseverance
Dr: intelligence
Dr: luck
. Cr: . advisory score

[Gatorbates]

Since the defense for patent B was unsuccessful, then you really don't own the patent; therefore you cannot capitalize the cost.

Licensed Florida CPA:
B: 71, 73, 79
A: 83
R: 78 (expired), 77
F: 74, 74, 80

It's finally freaking over.

[Gatorbates]

Since the defense for patent B was unsuccessful, then you really don't own the patent; therefore you cannot capitalize the cost.

Licensed Florida CPA:
B: 71, 73, 79
A: 83
R: 78 (expired), 77
F: 74, 74, 80

It's finally freaking over.

[Guti]

teeteenounouche, welcome to the group. Are you done with all the chapters? Are you taking Becker?

FAR-84
AUD-
REG-
BEC-

[Guti]

teeteenounouche, welcome to the group. Are you done with all the chapters? Are you taking Becker?

FAR-84
AUD-
REG-
BEC-

[zieba]

Of course! Duh! Thank you Gatorbates!

AUD - 75*, 88 done 5/14! (*exp)
BEC - 74 , 77
REG - 65 , 76 (10 point combooo!!)
FAR - 69 , 75

Dr: perseverance
Dr: intelligence
Dr: luck
. Cr: . advisory score

[zieba]

Of course! Duh! Thank you Gatorbates!

AUD - 75*, 88 done 5/14! (*exp)
BEC - 74 , 77
REG - 65 , 76 (10 point combooo!!)
FAR - 69 , 75

Dr: perseverance
Dr: intelligence
Dr: luck
. Cr: . advisory score

[teeteenounouche]

Thanks CR7, no I don't use Becker. I am just starting. My plan is to go through all of the lessons in 4 weeks and 4 weeks of MCQs/SIMs and review. It's a tight schedule but I'm going for it…

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

[Author]

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