[jeff]

Welcome to the Q2 2016 CPA Exam Study Group for FAR.

Some BLITZ videos to help your exams: https://www.another71.com/ninja-blitz

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

[Claudia408]

Operation – I think Wiley CPA Excel is the closest visually.

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

[Spartans92]

When you guys study..what does this typically mean? I asked because I feel like I did not accomplish anything today. All I did was watch the lecture and read the book and took notes. I was only able to attempt 20 MCQ. I will wake up earlier in the morning to study. I just don't know if it is because I am a slow learning but one chapter takes me forever. For the record, I am actually focused and spent approximately 4 hours total today on the material.

BEC- PASS

[Claudia408]

How is goodwill treated in this problem?

Jones Company acquired all of the stock of Abbott for $1,300 on 1/1/20X2, when Abbott’s assets had a carrying value of $2,100 and Abbott’s liabilities were $1,150. $150 of the difference was attributed to equipment, which had a remaining useful life of 6 years at 1/1/X2. The remainder is goodwill. Jones accounts for the investment under the equity method for interim reporting purposes. Abbott had net income in 20X2 of $600 and paid dividends of $120. How much will Jones report as Investment in Abbott prior to preparing consolidated financial statements at 12/31/X2?

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

[Just3Letters]

Hey Spartans,

I use Becker and CPA Excel,

For my studying, I do two sections per week. For example: I watched all the F5 Lectures today and I also did about 65 MCQ (63% correct booooo lot's of work to do!). Tomorrow and Wednesday I will finish all the MCQ including bonus for Becker and then 1 of the simulations offered. After that I use all the extra time to do MCQ from CPA Excel. For me, it's all about killing as many MCQ as possible. I hate it but that's how I learn personally. May not be the same for you.

Thursday I will watch F6 lecture and restart the same pattern blah blah blah until May 13th which is the big day!

I actually left a solid 2.5 weeks of death studying after I finish Becker so I can work a crap ton on any areas that I need help on (which seems to be quite a bit).

I take about a 30 minute break each 2 or 3 hours and study maybe 6ish hours focused per day. I'm lucky and just graduated from school and only work part time.

Not going to lie, though. I get pretty frustrated at least once per day and realize I just need some sun in my life so I take a little jolt out of my accounting cave in the sun.

Hope that helps~ let me know your secrets!

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

[Spartans92]

Thanks for the response Just3letter! I think that is a very great study strategy. I usually watch the lecture then read the associated section for the part I just watched and then I will do the MCQ questions in becker. Then same method for the next section. But today F9 just took me forever to read and watch the video due to its amount of information and people have said its heavily tested. So I took extra time to really read and tried to understand. I think I am calling it a night and start fresh tomorrow. I am also a recent grad so I am pretty much studying full time now as well. Just finishing up some additional classes online to meet the 150. I really appreciate your response. I have about 3 weeks so really need to focus.

Is this your first section?

BEC- PASS

[Just3Letters]

Claudia,

I wrote you and in-depth answer and the realized I think I was wrong haha

But acquisition price-NBV-Any premium attributable to identifiable assets=GW

Beg. Inv. is acquisition price

you amortize the 150 attributable to the equipment over 6 years=25 expense which decreases the investment each year

Also, you own all the equity so income increases investment and dividends decrease

So it should be acquisition price =1300-50 (two years of amortization of premium paid on asset) +net income 600 – dividends 120=
1300- 50+ 600- 120 = 1730 investment end of year 2

Is this correct? If not sorry!

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

[Just3Letters]

Hey Spartans,

Even though I assume you went to USC (spartans was a hint) we can be study friends haha

I went to Oregon State and USC creamed us in Football last year.

Yeah this is my first section and I can't really imagine anything I want more right now than to pass first time! We got this!

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

[KJ]

What topic is F9? Not using Becker so was wondering.

Some of the topics when I am reading them does seem like too much info to retain. When I do MCQ's for those topics then it helps me remember the stuff and retain the info. It works for me. I did not cover much material today (I guess 2 day break, did not took it intentionally, just killed the momentum). I am going to start fresh tomorrow. I work full-time so better get some sleep today.

FAR - August 2016
AUD - September 2016
REG - October 2016
BEC - November 2016

Remember: "Everything should be made as simple as possible, but not simpler." - Albert Einstein

[Claudia408]

Just3- nice try. the answer is $1755 and the explanation in the answer did not even take Goodwill into the calculation. What happened to it!?

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

[Just3Letters]

Claudia, I got 25 lower because for some reason thought there was two years of amortization. I did -50 instead of -25. I would have gotten the correct answer. Dang!

I don't really know why I mentioned the goodwill calculation. It's not part of what you need. You just need to know that the 150 premium attributable to that equipment has to be amortized/depreciated over the 6 year life and that expense decreases the investment.

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

[Spartans92]

I totally got lost at claudia's question..Yikes! :/ LOL. and Just3letters I actually went to Michigan state 🙂 But yes we can be study buddies haha. And Kanwal F9 is NFP and governmental. I just confused myself more from the reading. If anyone can help me clarify this it will be great. In F8 it said proprietary funds are reported in Govt wide F/S and under F9 it also mentioned these are part of the Fund F/S.. I guess I am just too tired now and can't really think straight. Correct me if I am wrong. Government wide F/S includes your governmental (GRSPP funds + internal Service) and your enterprise and the Fund financials are the governmental, proprietary, and Fiduciary? Both needs to be reconcile.

BEC- PASS

[Just3Letters]

haha oops spartans/trojans mix up there! You guys beat the Ducks so now we are best study buddies 🙂

Directly from my advanced actg text:

“In addition to the government-wide F/S, the CAFR includes financial statements for each of the government's fund types- governmental, proprietary, and fiduciary” so the proprietary statements are integrated into government-wide f/s IN ADDITION to being stand-alone statements.

Governmental funds: General fund, Special Revenue Fund, Capital Projects funds, debt services funds, permanent funds
Proprietary funds: enterprise, internal service
Fiduciary: pension trust, investment trust, private-purpose, agency

Governmental funds f/s: modified accrual -B/S, Statement of revenues, expenditures, and changes in fund balance
Proprietary funds f/s: full accrual- Statement of net position, statement of revenues, expenses, and changes in net position
Fiduciary funds f/s: Statement of fiduciary net position, Statement of changes in fiduciary net position

Does that help at all?

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

[Spartans92]

Haha Yes we did! Thank you very much! that does help. Was mainly confused on the fund financials vs government wide f/s. But its all clear now! Are you working for the B4 this come fall?

BEC- PASS

[Just3Letters]

Yeah when I was learning that stuff in school it took me forever to understand it. We only did 3 weeks of governmental and I'm pretty confident there is enough material to make an entirely new major!

I'm starting at Perkins & Company this fall. A regional firm in Portland, Oregon. You?

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

[Just3Letters]

On Jan. 1, Year 1, Cain. Corp issued 200 of its 9%, $1000 bonds at 103. Bonds dated Jan. 1, year 1 and mature on Jan. 1, year 11. Interest payable on Jan. 1 and July 1. Cain paid bond issuance costs of $5,000. Cain Corp uses IFRS. On Jan, 1, year 1, the net carrying value of the liability is:

a. 211000
b. 201000
c. 206000
d. 200,000

The answer is B but I chose D. I was thinking that it asks for the “NET CV”. When you issue bond don't you always report the net CV as the face value of the bond for the entire time you hold the bond?

Ex. Dr. Cash 201000
Cr. Premium on BP 1000
Cr. BP 200000

Anybody help me here? I know this must be very simple 🙁

I just got another question about this. According to Becker this is how GAAP works now too. I guess when it tells you to give the net cv of the BP it is the BP face value +- premium/discount +any bond issuance costs.

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

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