FAR Study Group Q2 2016 - Page 63

Viewing 15 replies - 931 through 945 (of 2,358 total)
1 2 3 … 62 63 64 … 156 157 158
  • Author
    Replies
  • April 23, 2016 at 9:43 pm #764601
    Just3Letters
    Participant

    Zyx,

    Pension Costs are always amortized out of OCI. The “Net period pension cost” is the amount that is amortized. So OCI will decrease by the 5000 and the I/S will expense the amortization in the current period.

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

    April 23, 2016 at 9:55 pm #764602
    Zyx
    Participant

    Just3Letters; that cleared it up, thanks lot!

    REG: 77 x2
    BEC: 81 x3
    FAR: 68 retake 10/1
    AUD: 8/27

    April 24, 2016 at 1:37 pm #764603
    Zyx
    Participant

    Can someone please give examples/differences of cash payments for loans made by the enterprise and cash repayments of amounts borrowed? They are so similar to me and yet the first one go to investing activities and the other go to financing activities.

    REG: 77 x2
    BEC: 81 x3
    FAR: 68 retake 10/1
    AUD: 8/27

    April 24, 2016 at 6:41 pm #764604
    Claudia408
    Participant

    This question seems like it's so easy to misinterpret. I know since PBO is $12mm and FV is $7mm, there is a shortage of $5mm. Now what is the adjustment to the PBO liability? I thought I should include unfunded accrued pension cost, AND unrecognized prior service cost, but I should only include the former. Then what is unrecognized prior service cost? Is the key word here unfunded versus unrecognized?

    On June 1, 20X8, Ward Corp. established a defined benefit pension plan for its employees. The following information was available at May 31, 20X10:

    Accumulated benefit obligation $14,500,000
    Projected benefit obligation 12,000,000
    Unfunded accrued pension cost 200,000
    Plan assets at fair market value 7,000,000
    Unrecognized prior service cost 2,550,000

    To report the proper pension liability in Ward's May 31, 20X10, balance sheet, what is the amount of the adjustment required?

    Answer: 4,800,000

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

    April 24, 2016 at 7:27 pm #764605
    Just3Letters
    Participant

    Claudia,

    I was totally stumped by this question. I actually did a search around the internet for an answer as to what “unfunded accrued pension cost” meant.

    I totally get it now. Just like a normal accrual, you have a cost to pay in the future which is a liability. So, you have the accrual liability already of 200,000. The question is asking for the additional liability adjustment required. The additional adjustment would be 5,000,000 – 200,000 (already considered in liability because of accrual) = 4,800,000.

    Very tricky.

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

    April 24, 2016 at 9:11 pm #764606
    Claudia408
    Participant

    Just3 thanks for that, makes sense. I was also wondering what is the unrecognized prior service cost? I feel like all these pension problems have the same verbage but I'm not catching onto it yet.

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

    April 24, 2016 at 9:13 pm #764607
    Claudia408
    Participant

    Totally lost on this questions. Roger's explanation isn't great.. Can someone help me pick it apart and weed out the fluff?

    On January 2, 20X8, Kine Co. granted Kristin, its president, compensatory stock options to buy 1,000 shares of Kine’s $10 par common stock. The options call for a price of $20 per share and are exercisable for three years follow­ing the grant date. Kristin exercised the options on Decem­ber 31, 20X8. The market price of the stock was $50 on January 2, 20X8, and $70 on December 31, 20X8. The fair value of a similar stock option with the same terms was $28 on the grant date.
    By what net amount should stockholders’ equity in­crease as a result of the grant and exercise of the options under FASB ASC 505 (SFAS 123(R))?

    Answer: 20,000
    Dr Cash
    Cr Equity

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

    April 25, 2016 at 4:55 pm #764608
    marqzho
    Participant

    Grant date
    Dr. Compensation expense 28000 (Shareholder Equity -28000)
    Cr. APIC stock option 28000 (SE +28000)

    Exercise Date
    Dr APIC stock option 28000 (SE -28000)
    Dr. Cash 20000
    Cr. CS par 10000 (SE +10000)
    Cr. APIC 38000 (SE +38000)

    So the net effect on SE = +28000-28000-28000+38000+10000 = 20000

    REG 90
    FAR 95
    AUD 98
    BEC 84

    April 25, 2016 at 9:12 pm #764609
    jeff
    Keymaster

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

    April 25, 2016 at 9:49 pm #764610
    Trele6
    Participant

    Took FAR today for the first time. Wow……… Those sims were killer. Completely gurssed on one, I pray it is the the protest one.

    I would say it was the minutiae that got me. I knew the overall general concepts and then the the sim wanted full on every detail JE.

    First test back of questions was tough and then I felt the record and third test banks were easier as my knowledge of the questions fit better.

    Praying now that I did well enough on the sims.

    First go at the CPA! Only using Becker
    Reg / Nov 2015 - 87
    Far / Apr 2016 - 79
    Bec / May 2016 - 80
    Aud / Aug 2016

    April 25, 2016 at 10:06 pm #764611
    Just3Letters
    Participant

    Answer to Jeff's question is B. $275,000

    Trele6,

    I've heard a lot of people recently talking about how much tougher the SIMS are than the MCQ. I'm sure you did fine! Lots of people think they did pretty bad and ended up passing. You can't tell how good or bad you did because of the pretest and the adjustments during the test on difficulty and weighting.

    Goes to show that we need to practice the SIMS after all though…

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

    April 25, 2016 at 10:15 pm #764612
    marqzho
    Participant

    Just3Letters

    I took the exam in Feb. My sims are easy and straight forward and on the big topic. They are nothing compared with the MCQs.

    🙂

    REG 90
    FAR 95
    AUD 98
    BEC 84

    April 25, 2016 at 10:21 pm #764613
    Claudia408
    Participant

    marqzho – you think MCQs are harder than SIMs? I think even if you get weaker on MCQ and stronger on SIMs you can pass. Well… that's how I passed Audit.

    Anyhoo, seems like 95% of the people taking these exams think they fail. Even you marqzho and you got a NINETY!!!

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

    April 25, 2016 at 10:25 pm #764614
    Just3Letters
    Participant

    Marqzho,

    I guess people's opinions on the test are all over the place.

    I feel very solid on the big topics. As long as I don't see anything super left field, I feel confident.

    As everybody says, though… the minutia is a killer.

    For example,

    If I see a retail inventory question, should I REALLY use lower of cost or NRV instead of lower of cost or market? These new changes are so frustrating because… If I make the change and the test does it the old way…

    I'm just over analyzing at this point 🙁

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

    April 25, 2016 at 10:33 pm #764615
    marqzho
    Participant

    Claudia

    If I remember correctly, you are the one(or not you?) told me I can still get a pass if I did bad in MCQ and good in SIMS. That actually helps 🙂

    REG 90
    FAR 95
    AUD 98
    BEC 84

  • Author
    Replies
Viewing 15 replies - 931 through 945 (of 2,358 total)
1 2 3 … 62 63 64 … 156 157 158
  • The topic ‘FAR Study Group Q2 2016 - Page 63’ is closed to new replies.