[jeff]

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

Free CPA Exam Survival Guide: https://www.another71.com/cpa-exam-survival-guide/

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

[jstay]

// i feel you, today wasnt that productive. did about 150 MCQ. 90 progress test then GAAP vs IFRS. tomorrow im taking second practice test and then continuing to write out journal entries

[Anonymous]

Found out a 72 on FAR yesterday and started studying again today for retake. 6 weeks is such a long time to review… ughhhhhhh.

[Anonymous]

Can someone please explain what this means exactly. Is the question worded funny? Or am I just not understnding:

FASB's conceptual framework explains both financial and physical capital maintenance concepts. Which capital maintenance concept is applied to currently reported net income, and which is applied to comprehensive income?

a

Currently reported net income: Financial capital

Comprehensive income: Physical capital

b

Currently reported net income: Physical capital

Comprehensive income: Physical capital

c

Currently reported net income: Financial capital

Comprehensive income: Financial capital

d

Currently reported net income: Physical capital

Comprehensive income: Financial capital

Answer C. Under the physical capital maintenance concept, gains and losses are recognized only when assets are disposed of or liabilities are settled. Both net income and comprehensive income apply the financial capital maintenance approach under which holding gains and losses are recognized.

Thank you.

[Anonymous]

The following beginning and ending balances @ YE:

Prepaid expenses Accrued liabilities

Beginning balance $5,000 $8,000

Ending balance $10,000 $20,000

Debits to operating expenses totaled $100,000. What amount did Ina pay for operating expenses during the current year?

a $83,000

b $93,000

c $107,000

d $117,000

Answer B. The amount paid for operating expenses during the current year is computed as follows:

Operating Expenses (given in problem): $100,000

PLUS Prepaid Expenses (increase): $5,000

MINUS Accrued liabilities (increase): ($12,000)

Cash paid for operating expenses: $93,000

Is anyone able to explain in a simple way the rules for when to add and subtract decreases on increases in assets/liabilities.

[jstay]

prepaid increased so they actually paid for it. i.e money went out the door

accrued liabilities increased so they saved cash.

had liabilities it decreased it would gave been added because cash went out to pay

[Anonymous]

I have a question regarding the derivative section. On one of the simulations on the Wiley book, they have a question on hedging purchases and receivables. But what I'm confused is would it be translation or transaction gains and losses? For example, Company A purchased inventory from a Euro CO on April 1st for $20,000, on May 1st when the payment was made it was 25,000. So the J/E would be:

April 1st

DR-Purchases 20,000

CR-Accounts/Pay 20,000

May 1st

DR-Accounts/Pay 20,000

DR-Losses 5,000

CR-Cash 25,000

So would the loss be transaction or translation? Thanks!

[husker4]

taking FAR on wednesday and feel like i have no shot. how should i spend my last couple days? any particular areas you think are most important?

[jstay]

husker4, never took it. taking it 8/31 from what i hear gov/nfp ifrs and journal entries

good luck!!!!

[Anonymous]

One mistake I have made is I don't spend much time during the few days before the exam looking at the simulations. If I were you, I would go over every simulation in the book and understand the journal entries. Even if you are not able to get the numbers right, you will get partial credit on just getting the entries correct.

Spend a lot of time on NFP-GOV sections. These shouldn't be too difficult and could be easy points for you. I feel very disappointed every time I score comparable on these two sections as they should be in the “stronger” section.

FAR has tons of material so there is really no right or wrong answer in what you should be looking at since everything is fair game. If you could really knock out NFP and GOV on the exam, you will have a great shot at passing. There is a GREAT chance you will have a simulation or two regarding making journal entries so don't leave any behind. If you are good at that, I see no reason why you shouldn't pass. I am going to retake the exam in October and will try to understand every single journal entry from the book and homework problems. Good luck!

[Anonymous]

So any of you guys know the question I just asked a few posts prior?

[jstay]

the question about derivative? which from my take, it wasnt really derivatives but a foreign currency problem. it would be a transaction since all you did was buy goods from a foreign entity and lost money on the transaction, it would go on I/S

[Anonymous]

Yeah, it was more so a foreign currency question. Good stuff, so what I received goods and it was a gain or loss? Does it change or it will be transaction for that as well?

[jstay]

im not really sure what you are asking, but im pretty sure when you have a “deal” like that- to buy goods from a foreign entity at some point you would record either a gain or loss depending on exchange rate at that time

[jstay]

foreign currency transaction/translation/remeasurement isnt really my strong area

[Anonymous]

Basically looking at that simulation and trying to figure out when to use translation opposed to transaction.

I kind of get it now, and at least if you get this question on the test you will be prepared for it LOL.

[Author]

Replies