FAR Study Group Q2 2016 - Page 11

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  • April 2, 2016 at 10:07 pm #763821
    Just3Letters
    Participant

    Hey guys!

    I'm studying for FAR for the first (and hopefully only!) time! This is also my first section (eek!)

    I'm in Becker F4 right now and one of the questions should be easy but has me stumped.

    The retail inventory method includes which of the following in the calculation of both cost and retail amounts of good available for sale?

    A. Freight in (which I incorrectly chose)
    B. Net Markups
    C. Purchase Returns
    D. Sales Returns

    Apparently C is correct. The answer says it is “Important to memorize the retail worksheet format”. I don't remember going over any retail worksheet format. Anybody know what this is talking about? thanks!

    FAR- 81
    REG- 81
    BEC- Aug 22, 2016
    AUD- TBD

    April 2, 2016 at 10:14 pm #763822
    Just3Letters
    Participant

    Hey Claudia,

    I'm not to Cash flows yet but I (somewhat) remember from school.

    You are talking about the indirect CF method. You start with net income and then add back any non-cash expenses (deprectiaton/amortization for example) and subtract any non-cash “good stuff” like gains. That gets you cash from operations. That's the hard part.

    After that you decrease for any increase in assets such as purchasing a manufacturing plant (because you paid cash for it) and add for any decrease in LT assets because you got cash for selling them.

    Finally, financing activities. fairly simple. Issue debt=get cash. Sell C/S=get cash. Pay dividends=subtract cash.

    Add all three sections together for net increase/decrease for the period. Easier said than done. Good luck!

    FAR- 81
    REG- 81
    BEC- Aug 22, 2016
    AUD- TBD

    April 3, 2016 at 4:38 pm #763823
    Claudia408
    Participant

    Just3 – Thanks, that is a nice summary of the indirect method.

    BEC - 75 (3x)
    AUD - 78 (3x)
    REG - 67, 66, Aug 1
    FAR - 54, Sept 8

    April 3, 2016 at 4:40 pm #763824
    Claudia408
    Participant

    Can someone explain this problem differently? It's not clicking with me bc the 2 companies in the problem buy and sell only to eachother and I didn't even know where to start..

    Ahm Corp. owns 90% of Bee Corp.'s common stock and 80% of Cee Corp.'s common stock. The remaining common shares of Bee and Cee are owned by their respective employees. Bee sells exclusively to Cee, Cee buys exclusively from Bee, and Cee sells exclusively to unrelated companies. Selected 20X1 information for Bee and Cee follows:

    Bee Corp Cee Corp
    Sales $130,000 $91,000
    Cost of sales $100,000 $65,000
    Beginning inventory None None
    Ending inventory None 65,000

    What amount should be reported as gross profit in Bee and Cee's combined income statement for the year ended December 31, 20X1?

    Answer: 41,000

    BEC - 75 (3x)
    AUD - 78 (3x)
    REG - 67, 66, Aug 1
    FAR - 54, Sept 8

    April 3, 2016 at 4:51 pm #763825
    Spartans92
    Participant

    @claudia I vaguely recall seeing this question in Becker… Sounds like intercompany transaction.

    BEC- PASS

    April 3, 2016 at 5:32 pm #763826
    Just3Letters
    Participant

    Hey Claudia, already been answered- https://www.another71.com/cpa-exam-forum/topic/can-anyone-please-explain-to-me-this-far-question

    FAR- 81
    REG- 81
    BEC- Aug 22, 2016
    AUD- TBD

    April 3, 2016 at 9:28 pm #763827
    Claudia408
    Participant

    Just3 – you're my new go to! you're good, lol! 🙂 my old go to left (marqzho), he got a 90 on FAR and is now on to Audit.

    BEC - 75 (3x)
    AUD - 78 (3x)
    REG - 67, 66, Aug 1
    FAR - 54, Sept 8

    April 3, 2016 at 9:52 pm #763828
    Just3Letters
    Participant

    Claudia,

    haha I only knew where that answer was because I had the exact same question and had to google it a couple weeks ago! The 50% COGS really confused me until I realized that the 50% is considering the value from the inside sale perspective (BEE sold in the inventory inside for 130000. 65000 is half of that)

    Dang I can only dream of a 90 on FAR! I'm taking it on May 13. How about you??

    I hope we can keep helping each other out! talk soon

    FAR- 81
    REG- 81
    BEC- Aug 22, 2016
    AUD- TBD

    April 3, 2016 at 10:45 pm #763829
    Claudia408
    Participant

    just3 – I have about 450 questions left in Roger's test bank that I haven't seen. I'm going a little faster than before but still not fast enough bc I want to go over most of them again, and go through SIMs. I'll probably buy Ninja MCQ later this week. I have 23 days left… wondering if I should push it back a week though…there's just SOOOOOOO MUCH!!!

    BEC - 75 (3x)
    AUD - 78 (3x)
    REG - 67, 66, Aug 1
    FAR - 54, Sept 8

    April 3, 2016 at 10:52 pm #763830
    Claudia408
    Participant

    i just changed my far exam lol… got me an extra 3 days.

    BEC - 75 (3x)
    AUD - 78 (3x)
    REG - 67, 66, Aug 1
    FAR - 54, Sept 8

    April 3, 2016 at 10:59 pm #763831
    Just3Letters
    Participant

    I know what you mean! I always want to just focus on doing more MCQ whenever possible! I got the Wiley Test Bank in addition to Becker (I know so much $$$ but I figure this is a pretty important use of money). I finish Becker and still have three weeks left to study as hard as possible before my exam which is pretty nice. I'm going to use that three weeks to do as many of the 1525 Wiley MCQ as possible.

    It's always better to take more time if you have it in order to study more.

    Keep it up!

    FAR- 81
    REG- 81
    BEC- Aug 22, 2016
    AUD- TBD

    April 3, 2016 at 11:42 pm #763832
    Anonymous
    Inactive

    well here goes nothing.. my exam is tomorrow @ 830AM and I can't study anymore, all i think about is tomorrow. I am still pretty weak in NFP and EPS. I should have NOT left that for the last two days of reviewing.

    I am also more stressed than ever because I only have tomorow and one last try in 3Q to pass this stupid exam otherwise REG expires, this is my last exam.

    I am expecting the worse and hoping for a 75.

    April 4, 2016 at 2:36 am #763833
    srv101284
    Participant

    Finally joining the party here. Taking FAR as my first section in late May after nearly ten years of coming up with excuses to put it off. I'm sure I'll be in here quite a bit over the next several weeks.

    I'm using Becker and will supplement with Ninja, but so far I'm concerned I'm not retaining enough info on my first pass-through of each section. I've finished F1-F4 and I've been averaging 70-75% on Becker homework and sims the first time around and have been having a hard time retaining info on certain topics. Is this low or is that normal?

    April 4, 2016 at 2:44 am #763834
    Claudia408
    Participant

    i really believe average is a better indicator than trending. if you average 65+ you will most likely pass.

    BEC - 75 (3x)
    AUD - 78 (3x)
    REG - 67, 66, Aug 1
    FAR - 54, Sept 8

    April 4, 2016 at 3:24 pm #763835
    marqzho
    Participant

    70-75% is my average and I passed 🙂 make sure you understand why you got 25% wrong.

    REG 90
    FAR 95
    AUD 98
    BEC 84

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