Get Out of Your Rut

Try us FIRST before you spend your hard-earned money.   CPA Review for FREE Over 2,400 FREE CPA Review Questions and Answers Available to YOU (for FREE)   November 18, 2013 Lesson 142     From:   Joe   IMPORTANT ANNOUNCEMENT   We have been looking for a way to fundCPAreviewforFREE.com so that we can continue to offer candidates 2,400 free questions and answers forever.  We believe that everyone needs access to affordable materials so they can pass the CPA Exam.   The CPA profession should be open to all people, even if you cannot afford expensive review materials.   So, over the last couple of months, I have been writing an entire book on Achieving Success.   I am thrilled with the way it has turned out – even better than I had hoped.   We will publish the book in January or February for under $10 (with proceeds going to supportCPAreviewforFREE).      We will have more information for you very soon but I wanted to get this book on your radar.  It is intended as a guide for anyone who wants to become more successful:   more successful on the CPA Exam, more successful in school, more successful at work, and just more successful in life.   You can never be successful 100 percent of the time but you can certainly increase the odds for success by adopting logical (and reasonable) strategies.   Success does not happen by accident.   That is the purpose of my new book – to help you (yes, YOU) become a more successful person at all of those goals that really do matter to you.      Help us continue to provide 2,400 free questions and answers to CPA Exam candidates whether rich or poor.   And, help yourself (or a friend or loved one) to think more carefully about the path to success.   You can help CPAreviewforFREE by buying a book.   You can also help by telling others.   Don’t be shy – spread the word.   WHAT MAKES SOMEONE SUCCESSFUL?   I was in San Francisco a few days ago on business and had some time to waste.   So, I wandered around the city and played one of my favorite games.   In this game, I assume that I am a rich business owner who has an unlimited number of jobs to fill.   I need one of everything:   bus driver, plumber, dish washer, etc.   As I walk from place to place and go in and out of buildings, I ask myself which people I would hire.   Who catches my attention for doing a particularly good job?   And, just as importantly, what did they do that caught my attention?  I am trying to figure out what makes someone particularly good at a job.   I am obviously interested in success and this is one way that I can better see what leads to success.  Focusing on the essential nature of success helps you become more successful.      Our Partner, Fast Forward Academy, Offers the Most Technologically Advanced Review Course    Fast Forward Academy has the best price in the market, but they also offer a simple 4 pay plan of $225 for 4 months. Full access with the first payment and then 3 easy monthly payments to follow.  FFA is a great option to affordably give you the edge to pass that problem area. 10% coupon code CPAREVIEWFORFREE.   No two people are exactly the same. We identify the areas YOU specifically need to study. Then, we adjust and accommodate your study by shaping our tools and content with laser focus to your exact needs. This is not a one-size-fits-all obsolete industrial model to education, but rather the future... a one-size-fits-YOU custom approach to learning and succeeding..That's Intelligent Learning!     In life, a few people are absolutely terrible at their vocations and a great majority are just average.   Luckily, the remaining folks (a relatively small number) are absolutely excellent.   What makes them so very good?   Why would you hire Mr. A rather than Mr. B?   What can we learn from these people?   For example, while I was in San Francisco, I had to go across town in a taxicab and then back to work in a hurry and the driver was wonderful.   He stayed calm in heavy traffic and was quite friendly and helpful.   I would have hired him for my company.   I liked his attitude.  I liked his efficiency.   If I drove a cab, I would like to be like him.   I went to a deli (a large chain) one afternoon and ordered a sandwich.   Four employees stood in a line making sandwiches.   Three of these people never looked at me even once, never smiled, never seemed to care if I lived or died.   The third person in the line looked up with a kind smile and asked how she could be of help.   She listened to my request and made the sandwich in the way that I had asked.   She was quick and efficient.   I would have hired her for my company.   Her attitude made my day a bit brighter and she did her work with a certain sense of enthusiasm.   If I made sandwiches for a living, I would like to be like her.   There are two ways to do things--More..   Get Out of Your Rut   On the airplane ride back from San Francisco, I was reading the magazine that is in the back of the seat pocket.   It contained an interview with Malcolm Gladwell, a writer whom I really enjoy.   He has a new book out titled David and Goliath talking about how underdogs can overcome the odds and manage to win.  In this interview, Gladwell had one line that really caught my attention:   “Don’t be passive and lose.”     I loved that.   Too many people who get behind (for whatever reason), become discouraged and go down without a fight.   They just give up.   That’s nonsense.  The only way to win if you are up against a difficult opponent (like the CPA Exam) is to put up a strong fight and then fight some more.   If you don’t like how things are going at the moment, reassess your strategy and make changes and go back into the battle.   Don’t be one of those people who just accepts “their fate” and lets failure wash up over them like the tide.   Failure is almost never inevitable.   Make changes.  For instance...   Points to Pass™ for Financial Accounting & Reporting, one of four sections needed to pass the CPA exam, benefits users by working hundreds of new questions by question or by topic.  A user can try the same question again (and again and again with different numbers) until sure they have mastered the concept.  The best way to succeed is to practice, andPoints to Pass™ allows candidates to do that for as long as they feel is necessary.     Time for a little practice     Every time you figure out a new question, you have potentially added another point to your CPA Exam score.   So, always be looking for new questions, especially for questions that you might struggle with.   That’s where points can be added.   FAR   Little Company has 1,000,000 shares outstanding.   Big Company pays $40 per share to acquire 800,000 of these shares.   That price was considered reasonable for all of the outstanding shares of the company.   Little had two assets:  equipment with a net book value of $10 million and a fair value of $16 million and buildings with a net book value of $17 million and a fair value of $21 million.   Little had no liabilities.   On consolidated financial statements immediately after the acquisition, what is reported on the balance sheet as the noncontrolling interest?   A.   -0- B.   $3 million C.   $5 million D.   $8 million     Auditing   CPAs for Englewood and Cliffs are auditing the financial statements of Veronica, Inc.   The auditors are currently assessing the level of control risk.   They have decided to test the operating efficiency of several specific controls in the accounts receivable system.   Which of the following controls are they most likely to test the operating efficiency?   A.   Controls where a significant deficiency exists B.   Controls that are suitably designed to prevent or detect a material misstatement C.   Controls that seem to be weaker than they were in the previous audit. D.   All controls relating to the audit must be tested.     Regulation   A company has a utility patent and a trademark.   An author has a copyright.   What are the valid lives of these rights?   A.   Utility patent – 20 years, Trademark – indefinite, and Copyright – life of author plus 70 years B.   Utility patent – 20 years, Trademark – 24 years, and Copyright – life of author C.   Utility patent – 27 years, Trademark – indefinite, and Copyright – life of author D.   Utility patent – 27 years, Trademark – 24 years, and Copyright – life of author plus 70 years   BEC   What is meant by nominal GDP (gross domestic product)?   A.   The price of all goods and services produced by a domestic economy for a year at current prices. B.   The price of all goods and services produced by a domestic economy at price-level adjusted prices. C.   The maximum amount of production that could take place in an economy without putting pressure on the general level of prices. D.   The price of all goods and services produced by labor and property supplied by the nation’s residents minus depreciation.       ANSWERS   FAR   Answer is D   Little Company is apparently worth a total of $40 million.   That is 1 million shares outstanding times $40 per share (a price considered reasonable for all the shares, even those not acquired by Big).   Of the total, the parent company acquired 80 percent or 800,000 shares.    Another (outside) party continues to hold the remaining 200,000 shares.   At the time of acquisition, they are worth $40 per share or $8 million in total.   That is reported on the balance sheet to indicate that assets are being consolidated at full value even though the parent only has an 80 percent ownership.   Some other party or parties continues to hold the remaining 20 percent of the $40 million subsidiary.   The balance sheet will balance because of the inclusion of this 20 percent non-controlling interest.   Auditing   Answer is B   A CPA has no need to tests the operating efficiency of an internal control unless it is well designed.   Based on this preliminary assessment, the auditor wants to rely on the control so that control risk can be assessed at a lower level and the necessary amount of substantive testing is reduced.   There is no potential benefit unless the control risk is well designed so only in that case will the auditor move on to do the testing for operating efficiency.   Regulation   Answer is A   Utility and plant patent last for 20 years but a design patent is only valid for 14 years.   A trademark must be renewed periodically but that process can go on indefinitely.   If owned by the author, a copyright is for the life of the author plus 70 years.   A copyright owned by a publishing house has a 95 year life (from the publication date) or 120 years from the creation date whichever expires first.     BEC   Answer is A   Nominal GDP is the price of all goods and services produced by a domestic economy for a year at current prices.   Real GDP is the price of all goods and services produced by a domestic economy at price-level adjusted prices.  Potential GDP is the maximum amount of production that could take place in an economy without putting pressure on the general level of prices.   Net domestic product is the price of all goods and services produced by labor and property supplied by the nation’s residents less depreciation.   Have a great week.   The October-November window is heading toward its end.  Remember that you can still sit for the exam until Dec 6.   Put in the time and effort necessary to end the year on an upswing.    You can do it!!!     Joe Hoyle President CPA Review for FREE