[jeff]

Welcome to the Q1 2017 CPA Exam Study Group for REG. 🙂

[jack yassa]

@esenthil

Ye's please!

[sweazy]

I just spent the last 7 days doing all the Becker MCQs, 1500 total. 76% on tax, 72% on ethics, 66% on law… combined 72%. Test in 3 days. Keep hitting all sections, or focus on my weaker areas that are in the low 60's? I figure I have time for about 500 more, or maybe read through ninja notes and do 400 MCQs. Thoughts?

BEC: 77
AUD: 67, 85, 87
FAR: 74, 74, 79
REG: ___

[Anonymous]

@ sweazy I'd say ninja notes. I have my test tomorrow, and all I did today was read through ninja notes. I think the notes are a good way to remind you of the main points in all 8 chapters without having to re-read the book – Good luck!

[bravesfannc]

Good luck @ all4inQ1 I have my test on the 25th. NINJA mcqs average is 80% trending at 84%. This could be my last test. During the next 7 days my plan is to answer and understand as many mcq as possible and read over my NINJA notes. Also, I've signed up for the 2 week free trial from Wiley to practice Sims. Any suggestions or other advice?

FAR - 84 - 11/14/15
AUD - 76 - 2/6/16
BEC - 73 - 7/13/16
REG - TBD

[RE2PECT]

@bravesfannc- I'm doing pretty much the same thing, but I'm using Gleim and Wiley since my Ninja access expired a couple weeks ago. I signed up for the Wiley trial and did all the sims and tax mcq's. Now I'm reworking Gleim sims and printing out mcq's that are giving me problems. Next weekend I plan on reading through Roger's book and reviewing the major topics and areas that are still giving me trouble. I'll probably reread the Ninja notes the day before my exam for a quick review. Hopefully this is it for me too! Good luck on your exam and to whoever else is taking it soon.

FAR: 75 Roger & Ninja (notes/flashcards/audio/MCQ)
AUD: 73, 81
BEC: 71, retake 8/29
REG:

[bravesfannc]

Thank you @ Re2pect. This is my 3rd attempt at REG. First was a 73 in Sept and then a 74 in Dec. On my trouble spots I've watched a few of the Wiley videos and a light went off and I actually learned the concept. Sometimes it takes someone teaching the concept a different way. I'm doing whatever it takes to pass this one. Each evening after work my wife is quizzing me on important topics. She will ask how do you calculate personal and corp AMT and the adjustments and preferences, how to calculate tax due on a 1040, what are the separately stated items. The list goes on and on. I think my notes that she quizzes me on is 12 – 16 pages. Before we start our saying is “What ever it takes to pass this last one.” Keep up the good work and you will pass.

FAR - 84 - 11/14/15
AUD - 76 - 2/6/16
BEC - 73 - 7/13/16
REG - TBD

[Anonymous]

Good luck to all of you guys. Keep us posted.

[Anonymous]

Some more AMT which helps

1.McRab Corp. has alternative minimum taxable income (AMTI) of $140,000. How much is McRab’s exemption for alternative minimum tax?
a. $38,000
b. $0
c. $12,000
d. $40,000

Answer : D

2.Chandler Inc. has regular taxable income of $123,000. Included in that calculation are the following items:
Percentage depletion in excess of cost depletion
$3,000
Private activity bond interest income
$2,500
Charitable contributions
$8,500
Chandler had a long-term contract and reported no income during the current year under the completed contract method. Income reported under the percentage of completion method would have been $12,000. What is Chandler’s alternative minimum taxable income (AMTI)?
a. $140,500
b. $149,000
c. $105,500
d. $128,500

Answer : A

This one is little tricky

Mark and Lucy owned two stocks, Tinker Inc. and Chance Inc., that became worthless during Year 8. The adjusted basis in Tinker was $300,000. Tinker was incorporated in Year 2, and Mark and Lucy purchased their stock in Year 4. Their adjusted basis in Chance was $200,000. Chance was incorporated in Year 2, and Mark and Lucy were original stockholders. Both stocks were purchased for cash, and each corporation had total capital of $500,000. How much ordinary loss can Mark and Lucy deduct on their joint Year 8 tax return as a result of these transactions?

a. $200,000
b. $300,000
c. $0
d. $100,000

Answer : D

3.Melanie is the sole stockholder of Machine Inc., an S corporation. Her basis in the stock as of the end of Year 4 is $43,400. During Year 5, Machine reported a loss of $19,000. During Year 5, Melanie received a distribution of $38,000 from Machine and guaranteed $11,000 of Machine’s corporate debt. What is Melanie’s total of stock and debt basis in Machine stock as of the end of Year 5?

a. $35,400
b. $0
c. $24,400
d. $54,400

Answer : B

4.XYZ Inc. was a C corporation through the end of Year 6. Starting at the beginning of Year 7, XYZ elected S corporation status. At the end of Year 6, XYZ had accumulated earnings and profits (E&P) of $55,000. At the end of Year 7, XYZ had a balance of $40,000 in its accumulated adjustments account (AAA). During Year 8, XYZ had ordinary income of $20,000 and made distributions of $100,000. Rob is a 50% shareholder in XYZ. He receives $50,000 (one half) of the distribution. His basis in the stock at the end of Year 8 is $18,000 before considering the distribution itself. What amount of the distribution to Rob will be a taxable dividend to Rob for Year 8?

a. $30,000
b. $18,000
c. $50,000
d. $20,000

Answer : D

5.Olinto Inc. has taxable income (before special deductions and net operating loss deduction) of $92,000. Included in that amount is $12,000 interest and dividends income. Forty percent of Olinto’s property, payroll, and sales are in its home state. What amount of this taxable income will be taxed by Olinto Inc.’s home state?

a. $44,000
b. $90,000
c. $36,800
d. $12,000

Answer : A

[bravesfannc]

The Example : 3. Betty is age 74 and has AGI of $100,000. The following items may qualify as itemized deductions for Betty: Can you show how you came up with the answer. I must be missing something.

Thanks

FAR - 84 - 11/14/15
AUD - 76 - 2/6/16
BEC - 73 - 7/13/16
REG - TBD

[RE2PECT]

I was just doing a Gleim sim for REG that dealt with pro rata distributions from E&P and I got half of it wrong because of rounding differences. Since most REG sims make you calculate the answer instead of giving a drop down menu, it worries me that I could get most of a sim wrong because of this.

Does anyone know if an actual person reviews sims or is everything done by computer?

FAR: 75 Roger & Ninja (notes/flashcards/audio/MCQ)
AUD: 73, 81
BEC: 71, retake 8/29
REG:

[Anonymous]

Here you go.

Example : 3

Betty is age 74 and has AGI of $100,000. The following items may qualify as itemized deductions for Betty:
Qualified medical expenses
$8,500
Real estate tax
$1,200
State income tax
$800
Charitable contributions
$600
Mortgage interest on acquisition indebtedness
$2,000
Home equity interest on a loan not used to improve the home
$300
Miscellaneous itemized deductions
$1,500

What is the itemized deduction add-back for AMT?

a. $3,300
b. $3,800
c. $2,500
d. $8,800

Answer : A

Itemized deduction Add Back :

= Qualified medical expenses – 1000 ( 8500-7500(7.5% of AGI – AGI – 100,000) – So 1000 disallowed
+ Real Estate Tax – 1200
+ State Income Tax – 800
+ Home equity interest on a loan not used to improve the home
$300 – ** Key word “NOT”

– I keep missing this

= 1000 + 1200 + 800 + 300
= 3300

* Above 65 yr old – AMT is allowed only above 10 % of AGI and regular tax it is 7.5% of AGI
* Miscellaneous deductions allowed are above 2 % of AGI so it is 2000 in this case – so no add back

OMG it hurts 71 and 74. I got 72 last time. I am sure you will come through with flying colors this time. All the best 🙂

[Anonymous]

@RE2PECT – Becker is the same. Becker expects to round it off. Some SIMS if I enter the correct answer with 2 decimal places it grades as a wrong answer. I am not sure about the real exam. I read somewhere in this forum only BEC essays are graded by real person and all others are by computer. I am not sure though. All the best again 🙂

[bravesfannc]

I was missing the $1,000 disallowed medical expenses. Thank you. That could be just the information needed to pass this test.

Thanks!

FAR - 84 - 11/14/15
AUD - 76 - 2/6/16
BEC - 73 - 7/13/16
REG - TBD

[Anonymous]

Most welcome:-)

I think you will like the below ones .

1.Harry has various items of income as follows:

W-2 wages
$24,000
Interest and dividends
$3,000
Rental real estate on Schedule E
$8,000
Income from an S corporation from Schedule K-1
$12,000
Income from a general partnership from Schedule K-1
$10,000

For purposes of the self-employment tax, what are the net earnings from self-employment? (Note: Please answer before the required 92.35% calculation performed on Schedule SE.)

a. $10,000
b. $22,000
c. $57,000
d. $30,000

Answer : A

2.Anthony entered into a long-term construction contract in Year 3. The total profit of the contract is $80,000 and does not change over the life of the contract. The contract will be completed in Year 5. The contract is 20% and 70% complete at the end of Years 3 and 4, respectively. What is the alternative minimum tax adjustment required in Year 5?

a. ($56,000)
b. $24,000
c. ($24,000)
d. $56,000

Answer : A

3.Carol has taxable income before personal exemptions of $48,000. Included in that calculation are the following items:
Real estate taxes on her home
$2,000
Mortgage interest on acquisition indebtedness
$1,200
Charitable contributions
$550
Carol also had excluded municipal bond interest income of $8,000, $3,000 of which was deemed to be private activity bond interest. What is Carol’s alternative minimum taxable income (AMTI)?

a. $50,000
b. $54,200
c. $54,750
d. $53,000

Answer : D

[jack yassa]

@esenthil

May you please post the full explanation as well!

Thanks

[Author]

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