FAR Study Group Q1 2015 - Page 40

Viewing 15 replies - 586 through 600 (of 851 total)
1 2 3 … 39 40 41 … 55 56 57
  • Author
    Replies
  • January 30, 2015 at 5:41 pm #654742
    jasbeerch
    Member

    DDB- Salvage value is not deducted for depreciation base.

    Depreciation cannot go below salvage value.

    Ex: 10,000 asset, 4-yr life, $2,000 salvage value

    1/4 = 20% , DDB= 40%

    1st year – 40% *10,000 = 5000

    2nd year – 40% * (10000-5000) = 2500

    3rd year – 40% (10,000-7500) = 1000 (here depreciation is below salvage value)

    Here, book value of asset – salvage value= 2500-2000= 500–> this is the deprecation for 3rd year

    3rd year depreciation = 500

    I hope its clear now

    January 30, 2015 at 7:05 pm #654743
    Determined CPA
    Participant

    titoav15 – I thought it would be C – both. Im still confused on the explanation for this one.

    A - 75
    B - 78 God is good.
    F - 77 Answered prayers.
    R - 84! Done!!

    Paperwork sent - waiting for license!!
    Still on a cloud and in shock. Through God, all things will happen.

    January 30, 2015 at 7:36 pm #654744
    Determined CPA
    Participant

    monikernc – any conclusions on your question? Those questions are not my strong point so im not really able to help, but am curious what the answer is.

    A - 75
    B - 78 God is good.
    F - 77 Answered prayers.
    R - 84! Done!!

    Paperwork sent - waiting for license!!
    Still on a cloud and in shock. Through God, all things will happen.

    January 30, 2015 at 8:13 pm #654745
    excel monkey
    Participant

    I haven't got to hedging/derivatives yet, so I'm no help there either.

    On the depreciation one, however, I may be able to help.

    Anytime there is salvage value, accumulated depreciation will not equal the historical cost. To calculate the maximum amount of deprecation, you subtract the salvage value from the historical cost. That gives you the total amount of depreciation you can take over the life of the asset. Even if you use DDB, your total accumulated depreciation is limited to this amount. Given the 15% salvage value in the question, when fully depreciated, the asset will have a net carrying value of 15% of the original cost.

    The only way that total accumulated depreciation=historical cost is if there is no salvage value. Had the question said there was 0 salvage value, answer C would have been correct.

    FAR - 91
    AUD - 88
    BEC - 86
    REG - 79

    January 30, 2015 at 8:21 pm #654746
    Determined CPA
    Participant

    excel monkey – makes sense, thanks!

    A - 75
    B - 78 God is good.
    F - 77 Answered prayers.
    R - 84! Done!!

    Paperwork sent - waiting for license!!
    Still on a cloud and in shock. Through God, all things will happen.

    January 30, 2015 at 8:25 pm #654747
    excel monkey
    Participant

    No problem. How'd the EPS stuff work out for you?

    FAR - 91
    AUD - 88
    BEC - 86
    REG - 79

    January 30, 2015 at 8:26 pm #654748
    Determined CPA
    Participant

    I've made them my bitch! That and cash flow (thanks to your help!).

    A - 75
    B - 78 God is good.
    F - 77 Answered prayers.
    R - 84! Done!!

    Paperwork sent - waiting for license!!
    Still on a cloud and in shock. Through God, all things will happen.

    January 30, 2015 at 8:29 pm #654749
    excel monkey
    Participant

    Awesome! Glad I could help.

    FAR - 91
    AUD - 88
    BEC - 86
    REG - 79

    January 30, 2015 at 9:52 pm #654750
    titoav15
    Participant

    Thanks guys I got it now! I actually never realized that when you switch back from DDB to SL as mentioned in year 3 in the example jasbeerch gave actually consider salvage value then. Embarrassing lol. That saved me a couple of points on the exam!

    BEC: 5/21/14 82! PASSED HALF WAY THERE!
    FAR: 4/2/15 80! Almost there!
    AUD: 69, 74, 4/3/14 81! PASSED
    REG: TBD

    January 31, 2015 at 5:32 pm #654751
    Anonymous
    Inactive

    For the lessee, do you add the unguaranteed residual value or no? In the book it says the lessor does, but doesn't mention the lessee.

    Anyone else taking their exam this week?

    January 31, 2015 at 6:29 pm #654752
    Tati45
    Member

    Taking FAR next week and got a 69 on the GLEIM exam rehearsal. Should I be freaking out? I went back and reviewed my mistakes and now studying major topics but I am not really sure on what I should focus. I guess I am just anxious and need guidance.

    Please help!

    AUD - PASSED
    REG - PASSED

    My great concern is not whether you have failed, but whether you are content with your failure.
    -Abraham Lincoln

    January 31, 2015 at 7:42 pm #654753
    excel monkey
    Participant

    CPAHOPEFUL11

    The lessee does not add the unguaranteed residual value because they are not obligated to return the asset at a specified value (no liability for residual value). The risk related to residual value remains with the lessor, so it is included in their calculations. This is one of the only times the amortization schedule for lessor and lessee will be different (due to the different beginning values of the lease liability and the lease receivable).

    FAR - 91
    AUD - 88
    BEC - 86
    REG - 79

    January 31, 2015 at 7:44 pm #654754
    Anonymous
    Inactive

    Thanks! I wasn't sure about this as I am going through my review right now. Four more days until my test! Hopefully I will never have to take a exam ever again.

    January 31, 2015 at 9:59 pm #654755
    JMCAPASSO
    Member

    Question for everyone and advice….FAR is such a huge part of the CPA exam, so many chapters and a lot of information.

    My question is this: I will have gone through all of the MCQ's and SIMS by the end of the weekend. My exam is on 2/13. What does everyone do to review? With so much information, it's hard to just pinpoint one area. I know gov't and non profits are only supposed to be like 15-20% but form my experience there was a lot of it on my FAR exam last time I took it.

    Should i buy NINJA questions? I have becker review, ninja notes and audio. I find going through the becker book is nearly impossible.

    Thoughts please….

    Good luck to everyone!!!

    AUD - 49, 66, 72, 77!!
    FAR - 72, 73, 78
    BEC - 70, 74, 79, I'm DONE!!!!!!
    REG - 70, 76!!!! FIRST PASS

    Don’t faint in the day of adversity. Remember your ABCs—Adversity Builds Character!!! - Andy Andrews

    January 31, 2015 at 10:09 pm #654756
    Determined CPA
    Participant

    I love ninja! Definitely worth it!

    I have a question on governmental accounting:

    Under the modified approach to capitalizing infrastructure, governments apply the following principles to recording current year additions:

    answer: infrastructure expenditures are reported as expenses except for outlays that results in additions or improvements, which would be capitalized.

    I thought modified approach meant everything was classified as expenditures, not expenses with no capitalization. Am I reading the question wrong? Im assuming its asking for something else but I don't see it..

    A - 75
    B - 78 God is good.
    F - 77 Answered prayers.
    R - 84! Done!!

    Paperwork sent - waiting for license!!
    Still on a cloud and in shock. Through God, all things will happen.

  • Author
    Replies
Viewing 15 replies - 586 through 600 (of 851 total)
1 2 3 … 39 40 41 … 55 56 57
  • The topic ‘FAR Study Group Q1 2015 - Page 40’ is closed to new replies.