[jeff]

Welcome to the Q2 2017 CPA Exam Study Group for REG. 🙂

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

[Nikki]

Can someone help me understand this question – Why was tax exempt interest income included? Is it because its a S-Corp?

Newcomb purchased 40 Pronto S-Corp shares on January 31, Year 1, for $4,000. Pronto made no distributions to shareholders and Newcomb's Year 1 Schedule K-1 from Pronto reported an ordinary business loss of $1,000 and municipal bond interest income of $150. What was Newcomb's basis in the Pronto Stock at December 31, Year 1?

Answer: $3,150

=$4,000 + 150 – 1,000

[wng1885]

I believe that S corp and partnerships include exempt income when it comes to calculating a partner/shareholder's basis.

[RandomRandy]

I think Ninja MCQ has this wrong:

When a valid contract is entered into by an agent on the principal's behalf, in an undisclosed principal situation, which of the following statements concerning the principal's liability is correct?

The principal may be held liable once disclosed.
The principal must ratify the contract to be held liable.

A. Both I and II
B. I only (Correct Answer)
C. II only
D. Neither I nor II

The Becker materials state that the Agent and Principle are liable when the Principle's identity is partially disclosed and undisclosed. If the Principle's identity is know, then only the principle is liable and not the agent. I say the correct answer is D since the principle is always liable even if his identity isn't disclosed. The principle doesn't become liable after he has his identity disclosed.

Thoughts?

FAR: 74 1/15/16, 72 7/2/16 -_-
BEC: TBD
REG: TBD
AUD: TBD

"Nothing is impossible to him who will try" - Andy Bernard

[MeanJoe]

My understanding is that in a situation with an undisclosed principal the agent is liable unless the third party is aware of the principal then both the principal and agent are liable.

[famh110]

@randomrandy..i think the answer is B because … a undisclosed principal cannot ratify period so by the process of elimination the only correct choice is B. now, read what choice A says…if the undisclosed principal is later discovered, it may be held liable. its true because upon discovery of the undisclosed principal 3rd party has a choice as who they want to hold liable…either principal or agent so yea, principal can be help liable.

[YALA112]

Hi guys, I just REG this afternoon. What can I say? Im going to take it again. The MCQs were easy althought there were alo of law material that I wasnt ready for. I still think that I got a good grade on MCQs. SIMS on the other hand, were out of this world. No review course prepares you for those SIMS. They are BRUTAL!!!!!

[mashloum]

Hi Yala, can I ask which material you have used for the SIMS?
since my exam on 23rd of May, and I am really confused from Wiley SIMS which really does not explain much about the right answer!
Any SIMS other than TAX faced in the exam, or all of it tax?

[YALA112]

I used Beckers. Beckers do not prepare you for the SIMS on the exam. The SIMS onthe exam are time consuming and complicated. Lots of reading and documents to review. There's not enought time to finish them. Mind you I went to SIMS with 2 hours and 15 mins left and still did not have time to finish. all of them were tax related, but nothing like Beckers SIMS. Good luck!

[Anonymous]

I just took Reg this afternoon and I think they will re-format this exam for people sitting in the next window. The Sims are very similar to the ones in Gleim but there is just too much material to look at and review. I think the time allotted for the exam is disproportionate to the questions and materials presented for testing in the Simulation section. It wasn't ridiculously hard it was just too much stuff to review in a short period of time. It just doesn't make sense, having said that I think it is doable. If you have Gleim, practice at least 1 simulation a day and make sure you understand them all. You will be okay. Everything gets tested, everything.

[mashloum]

you made panicked!
If you have two days to review before the exam, you spend it on tax SIMS only or MC?
Also, I am confused about the AMT, so how much depth required for such topic?

[GoBears123]

Took REG today. Hardest exam of my life by far. Watch out for this one, for those of you who haven't taken it. It's utterly brutal, to the point I don't see how anyone could pass without a huge curve.

Anyone else take it today and feel the same?

FAR - 6/4/16 - 82
AUD - 8/27/16
REG - TBD
BEC - TBD

[Anonymous]

I took it earlier this month and felt that mcq were not difficult but SIMS were a different story. There were too many documents to review. I'm just hoping for the best come August.

[Nikki]

I need help with Liquidating and Non-Liquidating C-Corp Distributions in understanding Shareholder Vs. Corporations basis.
Ninja notes states contradicting information:

SHAREHOLDER BASIS IN A CORPORATION
Adjusted Basis of property transferred
+ Gain Recognized (only if less than 80% ownership)
<Boot Received> (includes assumption of a liability)
= Shareholder Basis

CORPORATE DISTRIBUTION – SHAREHOLDERS Use FMV of Property

[mashloum]

Gleim software for the SIMS is the best vs others, it is really giving more clarifications and stable system when you use, Wiley gave me tough time just to understand why this answer vs the other!
My advice, rely on Gleim SIMS !

[melonbread]

I took it around the end of April.
It was second time I took this…The first try I got a 73 and performed poorly on blaw and sims.
This time I spend time working more on sims on becker but as everyone has already mentioned, I don't this becker prepared me well for it.

MCQs were okay on the exam.
The second testlet got harder than the first one and there were more blaws.
I think I bombed it.
And sims… they were so much and I don't think I did well.
I don't remember much because it was so shocking to me…

[Author]

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