[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

[lampy44]

How is everyone preparing for the sims? Every time I go into a simulation I feel completely overwhelmed by information. I know from AUD I personally need to conquer this feeling because it happened to me on test day as well. Pointers? Using BEcker and supplementing Ninja Sniper. Thanks

[Mimeto]

Hi all! I just started studying for the FAR exam which will be my first.
I am debating which course to take. The dilemma is between Becker and Wiley. Currently I'm reading from Gleim textbook (still stuck on Unit 3) which a friend of mine gave me but it seems too short and is making me nervous that there is a lot left out. Any suggestions on which course is best?

FAR – March 2018
AUD – June 2018
BEC – September 2018
REG – December 2017/January 2019

[bryan7193]

Hey everyone,

The first exam I took was BEC on 9/10. For this exam, I used Becker and Ninja Notes/MCQ. However, I feel like I learned better using Ninja. Now I am starting to study for FAR and debating on just using the Ninja notes and the MCQ. The notes and MCQ's were very very helpful for BEC. Has anyone just used the Ninja notes and MCQ's and passed? Any advice is appreciated.

[Lisa17]

On December 1, Clark Co. leased office space for five years at a monthly rental of $60,000. On the same date, Clark paid the lessor the following amounts: First month's rent $ 60,000Last month's rent 60,000 Security deposit (refundable at lease expiration) 80,000Installation of new walls and offices 360,000What should be Clark's 20X1 expense relating to utilization of the office space.

A.$60,000 B.$66,000 C.$120,000 D.$140,000

The answer is $66K. I'm a bit confused…is the lessee supposed to absorb the amortization of the leasehold expense? I thought the lessor would capitalize and amortize on their books. Let me know your thoughts.

[kay]

The first month's rent of $60,000, plus one month (360,000/5 yrs = 72,000/12 months = 6,000 per month) of amortization of the leasehold improvements are the expenses for 20X1 since the capital lease start date is Dec 1st.
The Last month's rent is a prepaid, and because the security deposit is refundable it is not included in the expense.

[Lisa17]

@Kay….I understand the calculation. My doubt was related to who absorbs the leaehold amortization expense. Reviewing my notes, the lessee is the one making these improvements, therefore the lessee would be responsible for the expense. RIght?

Thanks!

[kay]

Aw.. sorry. Yes, the Lessee is the one making and getting the benefits of the improvements and claims the expense over the life of the lease, or property depending on if the lease is renewable or not.

[CPATY]

alrighty! ready to have a successful studying day! lets get this going!! (trying to be positive lol because I really don't want to study)

[msquared17]

@CPATY – I feel your pain. I've been avoiding it all morning. I'm feeling a little discouraged because its taking me forever to get through the modules. At this rate, I will be taking the exam in Dec. LOL

{{{{{positive vibes}}}}}

[Carter]

Taking FAR on October 6! Took BEC, REG and AUD in Q3 so just waiting to hear about those scores in the next week or so. Hoping that FAR will be my last exam and I can knock all of them out before starting my job.

[fxbinbin]

Hello all,
I'm sitting on 10/7 – 24 days to go! Just finished reviewing Becker materials for the 2nd time and going to start 3rd time review, I also supplement with NINJA MCQ and progressed through 1/3.

I'm currently doing okay with GAAP accountings but super extremely frustrated by GOV accounting, for my 3rd time review I'm focusing majorly on GOV accounting.

[Anonymous]

This might sound really dumb, but any suggestions on the MCQ? I took FAR in May and failed with a 70. My score release shows that I was comparable in the Sims and weaker in MCQ. I feel like this is because there is so many more areas tested in the MCQ. Any suggestions other than just continuing to hammer away at the MCQs? Hoping to take it again in October or November, depending on if I passed Audit in August.

[lampy44]

Can anyone explain this to me? Becker does not give any computations on how they arrived at $13,000

Able, Inc had the following amount of long-term debt outstanding at 12/31/Y1

14 1/2% term not, due Y2. $3000
11 1/8% term not, due Y 5 $107,000
8% note, due in 11 equal principle payment, plus interest beginning 12/31/Y2 $110,000
7% guaranteed debentures, due Y6 $100,000

Total $320,000

Bales annual sinking fund requirement on the guaranteed debenture is $4000 per year. What amount should Able include as current maturities of long term debts in 12/31/Y1 Balance Sheet?

Answer is $13,000
Explanation: The $4,000 sinking fund requirements would be disclosed in a footnote and not included as a current maturity of long term debt. Deposits into a bond sinking are an asset held by a trustee to repay the entire liability at maturity.
Choice “C” is correct, $13,000 current maturities of long-term debt at 12/31/Y1

[Jen-J]

Lampy – it's $3K for the note due in Y2, and 10K for 1/11th of the 8% note (the portion due within 1 year).

[lampy44]

Jen J- Thank you! I figured it wasn't complicated…

I am obviously on Long Term liabilites and PV/FV stuff.

If you have time and know the answer to this or anyone else out there!

Why is this question using PVOA of 4.712?
I thought this question was an Annuity due now aka you would add +1 to the 7 period PVOA? If that makes any sense.

12/30/Y1 a machine purhase with no interest bearing not requiring 8 payment of $20,000. First payment made 12/30/Y1 and others due annually (this is why I thought it was an annuity due now). At date of issuance prevailing rate of interst for this type of note was 11% PV factors

PVOA of 1 at 11%
Period 7. 4.712
8. 5.146

A) $102,920
B) $114,240
C) $104,620
D) $94,240

PV of note at 12/31/Y1 = 20,000 X 4.712 = $94,240
** I used 6.146 I understand I should have used 7 periods and not 8 but as stated, I thought this was an annuity DUE = 4.712 +1? What am I missing?

Answer: $94,240

[Author]

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