[jeff]

Free Study Planner, Notes, Audio, Flashcards: https://www.another71.com/cpa-exam-study-plan/

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

[Anonymous]

I can never figure out accrued interest

[Anonymous]

for 3 months – June, July, and August? I should probably know this since my test is today

[jstay]

yeah thats what i was thinking but I'm not really sure, the accrued interest really threw me off

[D C]

Is it?

DR: CASH 4250

CR: B/P 4000

CR: Premium 226

CR: APIC-Waarrants 24

Cash = (4000*1.04) from issue

+ Int Accrued (.09*3/12*4000)

B/P: Alway Always FV 4000

Apic Wrrants = 4000*2*$3

Plug Prem. for 226

B - 80
A - 71, 67, 77
R - 71, 77
F - 72, 77
DONE!!
Becker Self-study all the way! Did use Ninja Notes & Audio for FAR.

[D C]

Actually that is wrong. always forget something…

136k is premium

DR: CASH 4250

CR: B/P 4000

CR: Premium 136

CR: APIC-Waarrants 24

CR: Int. Payable 90

B - 80
A - 71, 67, 77
R - 71, 77
F - 72, 77
DONE!!
Becker Self-study all the way! Did use Ninja Notes & Audio for FAR.

[Anonymous]

it's funny how wrong accrued interest of 240000 gives me the same answer

[D C]

So the long way is the way I did it and you would have to know this if you had to list out the JEs.

BUT for MCQs the best thing to know is the way Iggy did it.

Bond proceeds (for bond only)

+ Warrant Value

= Total “bond value”

– Face Value of Bond

= Prem. or Disc. on Bond

4000*1.04 = 4160

3*2*4000 = 24

= 4136

Less Face=(4000)

Premium = 136.

This could also work for the Market method also but your warrant value would be baed on the amount allocated to the warrant which is % of Warrant * cash rec'd

The only thing with the above question is that it includes accrued interest so again you would want to know the JE for SIMs.

B - 80
A - 71, 67, 77
R - 71, 77
F - 72, 77
DONE!!
Becker Self-study all the way! Did use Ninja Notes & Audio for FAR.

[Anonymous]

they threw accrued interest there to just confuse us. Jerks

Thanks DC

[Anonymous]

why is B wrong?

Which of the following is included in other comprehensive income?

A.

Unrealized holding gains and losses on trading securities

B.

Unrealized holding gains and losses that result from a debt security being transferred into the held-to-maturity category from the available-for-sale category

C.

Foreign currency translation adjustments

D.

The difference between the accumulated benefit obligation and the fair value of pension plan assets

[D C]

Because it will be amortized out of OCI.. you don't actually move the funds…

D is correct because Funded status is reported as non-current asset or current, non-currrent, or both liability.

Only changes in funded status as well as “AGE” factors go into OCI.

B - 80
A - 71, 67, 77
R - 71, 77
F - 72, 77
DONE!!
Becker Self-study all the way! Did use Ninja Notes & Audio for FAR.

[Anonymous]

No C is correct

[D C]

I read only comprehensive income not “other” oops translation makes sense then. but yeah i thought you amortize out of the OCI so why wouldn't it be included? I'm confused with you now.. lol

B - 80
A - 71, 67, 77
R - 71, 77
F - 72, 77
DONE!!
Becker Self-study all the way! Did use Ninja Notes & Audio for FAR.

[jstay]

yeah DC is right it is amortized out of OCI, its already in accumulated OCI so it isn't going to be a part of OCI for the year.

A- i think was obvious, trading = I/S

B- as stated before its already in accumulated so its not going to be an addition to oci this year.

C- goes into oci for the year

D- it doesnt make sense because we compare pbo vs fairvalue of plan assets to figure out liability and or asset- not accumulated benefit obligation

..another key fact not related is that accumulated benefit obligation is based on prior and current.

PBO is based on future

..another thing lol is that pbo is only a current liability to the extent that the pbo due in one year is GREATER then the FV of plan assets..

say you have 500 pbo, with 100 due in a year and your fv plan assets is 350…the 100 is a current liability..not the whole 150

Also IFRS–DTA & DTL is always NON-CURRENT

hahah sorry just some last minute facts for you guys today!

[Anonymous]

what do you mean it isn't going to be a part of OCI for the year?

HTM could be payable in 10 years, so this unrealized gain/loss will be amortized for 10 years

[Anonymous]

I never really got this part “say you have 500 pbo, with 100 due in a year and your fv plan assets is 350…the 100 is a current liability..not the whole 150”. Due – payable to employees retiring?

Will you have to accrue pension liability of 150 net of tax DR OCI?

[Author]

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