[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

[Anonymous]

Question regarding Pensions, what are the JEs that involve OCI? I'm looking at the example in the Wiley book and it is sort of confusing. And I'm assuming for SC, IC, PSC it is just:

DR Pension Exp

CR Pension Liability

?

[Anonymous]

CPA to be,

I did a Becker 90 question progress test last Friday. Then the sections that I wasn't over 80% on, I re-did. Now I'm doing NINJA mc and will re-work every Becker SIM Thurs and Friday, the ones I don't do well on, I'll re-work up until Friday evening, get a good nights sleep, and look at them one last time Sat morning before the exam.

That's my recipe, hopefully, for success.

[Anonymous]

Since there are only a few days left in the testing window, I know most of you all are way ahead of me in terms of knowing the material, but I'm going to join this study group anyway.

I'm at the beginning stage of studying for FAR. This week: present value (ugh). If I keep telling myself that bonds are my friend, maybe I'll actually start believing it lol

I'm praying productive study sessions over everyone this week 🙂

[jstay]

cpahopeful, pension oci is for gains and psc

psc j.e.

Dr OCI

Cr pension asset/liability

dr: DTA

cr deferred tax benefit-oci

NOW- amortize to pension expense

dr net periodic pension expense

cr oci

dr deferred tax benefit-oci

cr deferred tax benedit- i/s

GAINS-

dr. Pension asset.liabilty

cr oci

dr: deferred tax expense-oci

cr DTL

NOW amortize to pension expense

dr: oci

cr net periodic pension expense

dr: deferred tax expense-i/s

cr deferred tax expense-oci

[Anonymous]

Thanks, also this question in the wiley book was confusing.

Rose Corporation, a publicly traded CO, implemented a defined benefit pension plan for its employees on Jan 2, year 1. The following data are provided for yr 2:

PBO 400

PA FV 362

Assume that as of Jan 1, year 2, Rose's pension plan was fully funded, and there were no recorded pension assets or liabilities on the BS. Ignoring tax effects, which of the folllowing entries would be needed to properly record the funding status of Rose's pension plan at DEC 31 yr 2?

Answer A debit to OSI for 38,000

So why would you do that here? I'm assuming you credit pension liability?

[Anonymous]

So jstay does OCI increase for gains and decrease for PSC?

[jstay]

im not really sure. maybe because it was fully funded so there should be no asset or liability and in order to remove it, they debited oci? and credited pension asset.liabiliy

but now that im looking at it, it would kind of make sense to debit pension liability and credit oci for 38,000

idk confusing..

[jstay]

yeah. oci has a credit balance so when you debit oci for psc it is decreasing oci. vice versa for gains. credit oci so it is thus increasing

[Anonymous]

Good stuff, I felt I have missed some easy points on this section on the exam by not knowing the little details.

So to recap, when it is fully funded, the JEs are

DR OSI

CR Pension Liability

How about when it is overfunded and underfunded?

[jstay]

im not really sure, that question really confused me

and idk what the journal entry (if any?) for an overfunded or underfunded plan would be

to my understanding it overfunded when you have more plan assets then your pbo

it is underfunded when your pbo is greater than your plan assets

but im not sure about the journal entry.

you have taken FAR before im assuming?

you said the sims in ninja are similar to the exam, thats true? i feel like theres no way to practice sims with other sims, everyone just says hammer out mcq

[Anonymous]

I've only done a few sims on Ninja but they are pretty similar. I think it is very important to look over the sims before the tests. If you have the JEs down and adjusting entries, that should be enough. Have you worked on simulation #58 on Ninja?

[Anonymous]

[jstay]

nope, only #8 last night. i did a 90 question progress test in becker now im going to do some ninja mcq. ill take a look at the sims later on tonight

[Anonymous]

So you are taking the exam on Saturday?

[Anonymous]

Can someone explain what this means exactly?

Preferred stock income under the equity method is equal to the dividends allocated to it. For non-cumulative preferred stock, this will equal declared dividends only. For cumulative preferred stock, this will equal the annual dividend preference regardless of payments in a year.

[Author]

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