[jeff]

Welcome to the Q4 2017 CPA Exam Study Group for FAR. 🙂

Introduce yourselves and let your fellow NINJAs know when you plan to take your FAR exam.

The Five Steps (NINJA Framework): https://www.another71.com/pass-the-cpa-exam/

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

[Lentilcounter]

@brickellCPA

Not sure if you saw the potential SIM topics from AICPA based on the blueprints but if so, was that helpful?

I'm impressed that 2 hours was all you needed for the Sims excluding the one you couldn't complete. It was probably a pretest.

BEC = 72 (6/08/16)
FAR = ?
REG = ?
AUD = ?

[IwannabeaCPA2017]

Good luck Brickell. Honestly, I'm really nervous how FAR is even after taking it 3x already. I came nothing close to the 75.. There so much to know, it is def the worst of all the sections. On another note, F5 Freaking SUCK BALLZ! I just wanna be done with FAR and not have to study anymore..

[IwannabeaCPA2017]

@Lentil and @Ana!! Huge shout out to you both for taking time out to do the SIMS breakdown. If I pass this exam (most likely because of SIMS) I owe you both a huge favor. Perhaps, as Olinto says come on over to the Midwest (Mi) Ill get you guys some coffee!

[Ana]

@iwannabe so glad you found it helpful! hope you passed…hope we all pass. If you're ever in SoCal you can get me coffee here too or steak tartare 🙂

[Anonymous]

@Lentil yes it was absolutely. The SIMs can be formatted in a way that each of those items listed can be tested on ONE SIM. Then there are SIMs where some of those topics can be broken down into smaller portions.

Yea I only had 2 hours left for the SIMs. 2 of them other than the supposed pretest gave me a bit of trouble. But the rest including the DRS and research question I felt very comfortable completing. Wish I could share more about it, but don't want to get into disclosure territory. The DRS on FAR were NOWHERE as scary as the DRS on REG in my opinion…but perhaps I just know the material better.

@IwannabeaCPA I would be surprised if I didn't pass…have been studying full-time nonstop since July…had my exam rescheduled twice…once due to hurricane closures and again due to technical difficulties at the testing center. So I've had THREE final cram sessions thinking I was about to take the test. I think those sessions helped me feel better prepared.

Its by no means an easy test. Though its just absolutely crazy that more than half the stuff you study and prepare for doesn't even show up at all on the exam.

Good luck everyone, keep at it 🙂

[Anonymous]

I have FAR scheduled for this Thursday, 4 days!! What should I do to cram? I'm finishing up Ninja MCQ now, have the notes, but feel like I'm just not fully comprehending everything to tie it all together. Any suggestions on what to really study more than others/any free cram things?

[Katie]

I just took my first Mock Exam through Becker with no review and got a 70. I wonder how closely these mirror the actual exam? If it's close, I definitely feel confident I can get that last 5% in the next two weeks before me exam.

[kara]

Hey BRICKELLCPA:

Did you look at the blueprints provided by AICPA? If so where those hopeful on knowing what you exactly studied for. I am now nervous I didn't study enough I have been studying full time for a whole month, but this weekend I slipped up and didn't study as much. I am testing on Tuesday. I am taking final Becker review test today, and one more AICPA Practice test.

[Anonymous]

@Kara, I've checked out the blueprints a few times but haven't really utilized it. I use NINJA exclusively and make the most of it. For me personally, I go through every MCQ one by one for each topic so that I don't miss anything and screenshot the most difficult problems so that I can save them and have them all in one spot when I do my final review. But from what I can tell, the blueprints can be helpful if you want to focus/allocate your time on preparing for certain areas/topics. I study literally everything in depth so the blueprints weren't as useful for me.

[Anonymous]

@BrickellCPA-congrats on finally taking the test-sounds like you did great! I had my first review session this weekend. And it was brutal. I scored 64,70,64 on progress tests in Becker, and my average in Ninja is 69…Not where I want to be 18 days out. I have had to review whole sections, redo MCQ just to refresh my memory. the last progress test yesterday was 88, but I don't trust it. I have about 400 MCQ left in Ninja before I finish my first pass through that test bank. I hope to review chapters 4-7 in Becker by midweek and then just hammer MCQ so that I can take a mock exam in Becker over the weekend. This one has me feeling the worst-too much info!

[Wannafree]

@BrickellCPA ,your exam experience is good booster for me.Hope you pass with flying colors.Did you prepare the SIMs through only Ninja or any other review (for SIM ) ? Any suggestions in context of Blue print documents .I am asking because I see IFRS minimum .U finished SIMs in 2 hours that is awesome.

[Anonymous]

Thanks guys, I'm really counting on passing too. The delay has cost me a number of potential job opportunities and the social/family life is basically non-existent.

I don't really have any recommendations because the thing is, so much material you study and prepare for might not even show up on the exam. There were two “major” topics that come to mind that I could have completely skipped over because it did not appear on my exam at all. But then on someone else's exam, they might have been heavily tested on it.

As for preparing for SIMs, there is another thread going by another member (Lentilcounter) that has a great list of what to expect. In addition to the list, I would recommend getting the journal entries down for some of the major areas (bonds, leases, governmental, stock transactions, and foreign currency, etc.). I used exclusively NINJA and found a few videos on YouTube that helped walk me through some concepts in more detail.

There is just so much to prepare for and only so much they can test you on…a big part of passing this exam is really just luck of the draw. The best way I can recommend to prepare is to know everything lol 😀

[Anonymous]

I agree on knowing everything! That's what I have been trying to do all weekend in my review is know everything! 🙂

[IwannabeaCPA2017]

@Brickell and anyone else that took the exam.. for the exam this quarter was there still a ton of documents/emails you have to read through to answer the sims? I recall over half of my SIMS last quarter had multiple documents. Thanks! Just wanted to make sure so I can work on time management..

[Anonymous]

The two questions below… could somebody help me out as to why you deduct the dividends on one, but not the other? I'm completely confused, I was thinking it should be deducted for both… Thanks in advance.

On January 1, Year One, the David Company acquires 40 percent ownership of Go Corporation for $200,000 although Go's balance sheet reports assets of only $80,000 with no liabilities. However, David made its acquisition because Go owns the rights to a patent that recently become very valuable and is assumed to be worth $420,000. The patent has an expected remaining life of five years. Officials of David believe that have acquired the ability to have significant influence over the operating and financing decisions of Go. In Year One, Go reports net income of $100,000 and pays a cash dividend of $10,000. David has chosen not to use the fair value option for this investment. On December 31, Year One, what should David report on its balance sheet for this investment?
$200,000
$202,400
$236,000
$240,000
Explanation: David has the ability to apply significant influence over the decisions of Go so that the equity method is applied. David recognizes income as it is earned by the investee so that $40,000 is reported in Year One ($100,000 times 40 percent). David views dividends as a return of its investment ($4,000 or $10,000 times 40 percent). Consequently, the investment initially reports $236,000 at the end of Year One ($200,000 cost plus $40,000 income less $4,000 dividends). However, David paid an amount in excess of the underlying book value of the investment. The company paid $200,000 but 40 percent of book value is only $32,000 ($80,000 in net assets times 40 percent). Some explanation for this additional $168,000 payment ($200,000 less $32,000) is required. Go held rights to a patent worth $420,000. Because David bought a 40 percent interest, an additional payment of $168,000 for the patent was anticipated ($420,000 times 40 percent). Because that amount equals the excess payment, no goodwill has to be recognized. The patent has a five-year life; David's payment is amortized over that period at the rate of $33,600 per year ($168,000 divided by 5 years). This amortization reduces the income recognized by David as well as the investment account which drops from $236,000 to $202,400.

On January 1, Year One, Giant Company bought 40 percent of the outstanding shares of Tiny Company for $500,000. This investment provided Giant with the ability to significantly influence the decisions of Tiny. At the date of the purchase, Tiny had a net book value (assets minus liabilities) of $1.1 million. On that same day, Tiny owned a building with a $300,000 book value but a fair value of $450,000. This building had a 10-year remaining life. During Year One, Tiny reported net income of $90,000 and paid a cash dividend of $20,000. The fair value method is not being applied to this investment. At the end of Year One, what should Giant report as its Investment Income from Tiny Company?
$21,000
$22,000
$30,000
$36,000
Explanation: Because Giant has the ability to significantly influence Tiny, the equity method will be applied. Giant paid $500,000 for 40 percent of the outstanding stock of a company with a net book value of $1.1 million. The underlying book value for that investment was $440,000 (40 percent of $1.1 million). Giant paid $60,000 in excess of that amount ($500,000 minus $440,000). Some assignment must be made of this additional payment. The building was worth $150,000 more than its book value ($450,000 less $300,000). Giant should assign $60,000 (40 percent of the $150,000 increase in value) to the building. That explains the entire excess amount so that no goodwill is recognized. This $60,000 allocation of Giant's purchase price is amortized over the 10-year life of the building at the rate of $6,000 per year. For Year One, Giant recognizes income of $36,000 (40 percent of the $90,000 income reported by Tiny) and $6,000 amortization of the building allocation for a net amount of $30,000.

[Author]

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