[jeff]

SO 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!

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

[Juliemiddle]

Could someone explain when to consider a note an Annuity Due vs. Normal Annuity? (Question f/ CPAExcel):

-On December 30, 2005, Bart, Inc. purchased a machine from Fell Corp. in exchange for a non-interest bearing note requiring eight payments of $20,000. The first payment was made on December 30, 2005, and the others are due annually on December 30.

To calculate the PV, I used the ANNUITY DUE table for 8 periods, which is wrong. I should have used the NORMAL Annuity table for 7 periods.

AUD: 84 - Oct. 2013
BEC: 83 - Feb. 2014
REG: 91 - May, 2014
FAR: 68, 96 - Oct. 2014...DONE

CPAExcel, Ninja Audio (all sections)

[Anonymous]

No help on my question? I must not be part of the cool kids club 🙁

Julie,

As far as your question that is confusing to me as well because I understand an annuity due to be payments made at the beginning of the term, like rent when you pay in advance of the month you will be staying. Since the first payment is due before the machine is being used I would have said annuity due as well. Sorry, I'm not help but I see where you are coming from.

[Juliemiddle]

@CPA2014Dream…I scrolled up to your question. If you're asking about the “Fort, Inc.” problem, there's not enough information to calculate a discount for the bond. It lists the stated rate, but not the market rate.

AUD: 84 - Oct. 2013
BEC: 83 - Feb. 2014
REG: 91 - May, 2014
FAR: 68, 96 - Oct. 2014...DONE

CPAExcel, Ninja Audio (all sections)

[Anonymous]

Julie,

Annuity Due – Payment due at begging of the year, ex, Jan 1.

Normal Annuity – Payment due at the end of the year, ex, Dec 31.

DM

[Anonymous]

CPAHOPEFUL11 – You sound like you're on track for success. I've been reading, but not contributing, due to a crazy schedule. It sounds like you have the concepts and J/E down, which is are really good indicators. Keep plugging at the rough spots and you'll nail it. Good luck tomorrow.

DM

[Anonymous]

Sorry, I didn't read your question either. And Julie is right, but the usual JE for bonds with stock warrants are:

DR Cash

DR Discount

CR B/P

CR APIC-Stock Warrants

[Anonymous]

Julie, I know why you use 7 periods since the first payment has already been made but no clue on why you don't use the annuity due table.

So essentially you look at the PV for $1 for 7 periods?

[Anonymous]

Hi! I want to know what your game plan is for 2 weeks before the test?

[Anonymous]

@Julie so that is a plug then, because the answer lists the discount amount which is why I asked. Thanks 🙂

[Juliemiddle]

@CPA2014Dream – Sorry…yes, just a plug. The proportionate amount of the Bonds in that problem is $900k (Net), and you “plug” the discount, since it's a $1M face value.

@CPA…OneDay – I'm in my last couple of weeks, as well. MCQs all day, errrrday. As I go thru the MCQs, I'm making flashcards and charts of items that still aren't sticking. Once I'm done with all the lessons, I'm doing Diagnostic exams in CPAExcel (basically more MCQs), then re-typing all my notes.

Not sure 2 weeks is enough :-/

AUD: 84 - Oct. 2013
BEC: 83 - Feb. 2014
REG: 91 - May, 2014
FAR: 68, 96 - Oct. 2014...DONE

CPAExcel, Ninja Audio (all sections)

[Anonymous]

On July 28, Vent Corp. sold $500,000 of 4%, 8-year subordinated debentures for $450,000. The purchasers were issued 2,000 detachable warrants, each of which was for one share of $5 par common stock at $12 per share. Shortly after issuance, the warrants sold at a market price of $10 each. What amount of discount on the debentures should Vent record at issuance?

Incorrect A.

$50,000

B.

$60,000

C.

$70,000

D.

$74,000

---

The answer is ‘C'.

My question is why/how are the market value of the warrants counted as part of the discount at issuance when the value (2000 x $10 market price) wasn't determined until “shortly” after the issuance of the debentures?

[Anonymous]

Thanks dmende, and I sure hope you are right.

aspiring1accounting, that question has confused me as well but I just basically memorized it as in they use the market value.

[Anonymous]

@Julie, Thank you! Good luck!

I was thinking of doing the same, just do MCQs and simulations…lol I rescheduled a month ago and I still dont feel it is enough time! I think that is just the nature of this test

[Anonymous]

What is the JE when a general fund transfer to a DSF?

[Anonymous]

CPA..one day – Yes, do not forget the sims. The MCQ are really important, but knowing the J/E and practicing the sims will help immensely.

DM

[Author]

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