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OnMyWay732.
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August 30, 2014 at 3:33 pm #188294
jeff
KeymasterSO I know every test is different but does anyone have any insight on what has been heavily tested recently? I take the exam Monday and I need to narrow my focus….Thanks!
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September 25, 2014 at 7:45 pm #627714
Anonymous
InactiveCompan A purchased 100% of company B for 100,000. FV of assets were 120,000 is there a gain or goodwill?
DR. Investment 120,000
CR. Cash 100,000
CR. Bargain Gain 20,000
September 25, 2014 at 7:53 pm #627715Anonymous
InactiveFor pensions, which accounts decrease OCI? Losses and PSC, while gains increase OCI?
Also, when it is overfunded is the JE:
DR Pension Asset
CR OCI
Btw, where is zkaraca? I was looking forward to that thread since my test is a week away Ha.
September 25, 2014 at 10:06 pm #627716Peterman25
ParticipantGoodwill when you pay more than fair value. CR Gain when you pay less than fair value – bargain purchase
BEC 7/14 - PASS
FAR 10/14 - PASS
AUD 1/15 - PASS
REG 4/15 - PASSAZ license - Official 8/20/2015
September 25, 2014 at 11:40 pm #627717Anonymous
InactiveIf an account is accidentally placed in a miscellaneous expense instead of amortization expense, what is the JE?
DR Amortization Exp
CR Miscellaneous Exp
?
September 26, 2014 at 1:41 am #627718Anonymous
InactiveDuring the audit of ABBB a series of cutoff issues were identified. For each of the potential December 31, year 2, sales cutoff problems listed below, double-click on the shaded space and select the appropriate adjustment for year 2 from the list provided. Each item in the list may be used once, more than once, or not at all.
Selection List
A. No adjustment necessary. F. Accounts receivable (dr.)
Inventory (cr.)
B. Accounts receivable (dr.)
Sales (cr.) G. Sales (dr.)
Accounts receivable (cr.)
Inventory (dr.)
Cost of sales (cr.)
C. Sales (dr.)
Accounts receivable (cr.) H. Sales (dr.)
Inventory (cr.)
D. Inventory (dr.)
Cost of sales (cr.) I. Accounts receivable (dr.)
Sales (cr.)
Cost of sales (dr.)
Inventory (cr.)
E. Cost of sales (dr.)
Inventory (cr.) J. Sales (dr.)
Cost of sales (cr.)
Potential cutoff problem Adjustment
1. The company shipped merchandise (FOB destination) to a customer on December 29, year 2, and recorded the sale but not the relief of inventory. The customer received the merchandise on December 31, year 2.
2. The company shipped merchandise (FOB shipping point) on December 3, year 2, to a customer, and recorded the sale and relief of inventory. The customer, unhappy with the merchandise, returned the goods on December 29, year 2. The company records the following entry upon receipt of the goods: Inventory (dr.), Cost of Sales (cr.)
3. The company shipped merchandise to a consignee on December 16, year 2, and did not record the transaction. The consignee returned the merchandise on December 28, year 2. Upon receipt of the goods, the company made the following entry: Inventory (dr.), Sales (cr.)
4. The company shipped merchandise (FOB shipping point) on December 29, year 2, and recorded relief of inventory, but not the sale, on that date. The customer has not received the merchandise and the company has not recorded the sale as of January 3, year 3.
5. The company shipped merchandise (FOB destination) on December 30, year 2, and recorded the sale, but not the relief of inventory, on that date. The customer received the merchandise on January 3, year 3.
September 26, 2014 at 3:25 am #627719Anonymous
InactiveOn January 1, Fonk City approved the following general fund resources for the new fiscal period:
Property taxes $ 5,000,000
Licenses and permits 400,000
Intergovernmental revenues 150,000
Transfers in from other funds 350,000
What amount should Fonk record as estimated revenues for the new fiscal year?
a.
$5,550,000
b.
$5,900,000
c.
$5,750,000
d.
$5,400,000
Explanation
Choice “a” is correct. Revenues include property taxes, licenses and intergovernmental revenues. Transfers would be considered estimated other financing sources. Estimated revenues are:
Property taxes $ 5,000,000
Licenses and permits 400,000
Intergovernmental revenues 150,000
Total estimated revenues $ 5,550,000
I selected choice d. $5400,000 because I understand that intergovernmental revenues and transfers in from other funds are estimated other financing sources.
Can someone please correct me how I am wrong and give the explanation for the correct answer.
Thanks
September 26, 2014 at 4:14 am #627720Peterman25
ParticipantCPA – I'm having a hard time with the selection list formatting, but here goes…
1. cr inventory dr cogs
2. dr sales cr a/r
3. dr sales cr inventory – this is to reverse what was done and didn't need to be done. the only entries that might have been made would be to move the inventory to consignee inventory accounts for tracking purposes. you still own the inventory when using a consignee,
4. cr sales dr a/r
5. no adj necessary
BEC 7/14 - PASS
FAR 10/14 - PASS
AUD 1/15 - PASS
REG 4/15 - PASSAZ license - Official 8/20/2015
September 26, 2014 at 5:46 am #627721Anonymous
Inactive5. is DR Sales and CR A/R
Why? Because it is FOB destination and there were no sales in year 2 so that entry has to reverse out.
4. DR AR and CR Sales
Why? Because FOB shipping point is a sale right when it is delivered. So the company has to record a sale which it didn't.
September 26, 2014 at 5:46 pm #627722GMCOpdxCPA
MemberAlright…I just scheduled my first exam, FAR, for November 24th. Here we go!
September 26, 2014 at 6:37 pm #627723Anonymous
InactiveDunne Co. sells equipment service contracts that cover a 2-year period. The sales price of each contract is $600. Dunne's past experience is that, of the total dollars spent for repairs on service contracts, 40% is incurred evenly during the first contract year and 60% evenly during the second contract year. Dunne sold 1,000 contracts evenly throughout 20X1. In its December 31, 20X1, balance sheet, what amount should Dunne report as deferred service contract revenue?
Incorrect A.
$540,000
B.
$480,000
C.
$360,000
D.
$300,000
Answer mentions something about a Average “exposure” of contracts which I have no idea why it's being applied.
Wall Co. sells a product under a 2-year warranty. The estimated cost of warranty repairs is 2% of net sales. During Wall's first two years in business, it made the following sales and incurred the following warranty repair costs:
Year 1
Total sales $250,000
Total repair costs incurred 4,500
Year 2
Total sales $300,000
Total repair costs incurred 5,000
What amount should Wall report as warranty expense for Year 2?
A.
$1,000
B.
$5,000
Incorrect C.
$5,900
D.
$6,000
For this prob. shouldn't total repair costs for Yr-two be subtracted to arrive at ‘net sales'? Or was I over-thinking this somehow?
Thanks.
September 26, 2014 at 7:26 pm #627724cbialob1
MemberServicing Assets, can anyone give a some examples of this . I understand what they are, just having difficulty understanding why collecting payments would be considered an asset.
September 26, 2014 at 7:38 pm #627725rzrbkfaith
Member@aspiring – Not yet studying FAR, but these would be my answers…
Dunne Co. question – wouldn't the answer be C – $360,000? If you sell a contract but only earn 40% of it, then 60% of it would be deferred. 600,000 x 0.60 = 360,000
Wall Co. question – wouldn't the answer be D – $6,000? If you are recording warranty expense, then you would DR warranty expense and CR warranty reserve (at least that is what we called it). Repairs would be recorded against the reserve, not expensed. 300,000 x 0.02 = 6,000
AUD - 99
BEC - 97
REG - 91
FAR - 1/8/16September 26, 2014 at 9:05 pm #627726Mehwish
MemberI just gave up on Consolidate FS
way too much 🙁
September 26, 2014 at 9:57 pm #627729Anonymous
InactiveJust remember this, all equity accounts of the subsidiary get eliminated along with the investment account for the parent. So if a question asks what is the RE or SE on the consolidated worksheet, use just the parent number. Also, all receivables and sales are eliminated so when asked how much of the receivable is owed, answer 0. If you get these two parts down along with knowing how to calculate goodwill, you will be fine.
September 27, 2014 at 3:20 am #627730Mehwish
MemberReally? I've been reviewing the wiley chapter all day on on Investments. The example there is really long. It has the I/S, Statement of Retained earnings, and B/S.
It includes everything you mentioned plus noncontrolling interest,and unrealized inventory assets!
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