Mapping of AICPA Sample Test Simulations to Universal CPA
The AICPA offers a sample test (linked here) for each section of the CPA exam and includes multiple choice questions and task-based simulations (TBS). The team at Universal CPA highly recommends you attempt the AICPA practice test as the questions have historically been very similar to what a candidate experiences on exam day. If you […]More
Accounting for Asset Retirement Obligations
Asset retirement obligations are tested on the FAR section of the CPA exam. Candidates can expect to see multiple choice questions and/or a simulation on the topic. Asset retirement obligations (ARO) are a legal obligation associated with the retirement of a tangible long-lived asset in which the timing or method of settlement may be conditional […]More
Capitalize Freight Paid by Consignor
In a consignment relationship, freight paid by the consignor to ship inventory to a consignee is capitalized by the consignor. However, why is that the case? Isn’t freight out expensed by the seller? The general rule is to remember that freight in = capitalize and freight out = selling expense, but in a consignment relationship, […]More
What is the journal entry to adjust commission expense?
Most companies will calculate actual commission expense by multiplying net sales by a a commission rate. For example, if the company had $15,000,000 of net sales and a commission rate of 3%, commission expense would be $450,000. So the company may already have a liability for accrued commission on the balance sheet based on estimates. […]More
Conditions to Accrue a Compensated Absence
Candidates studying for the CPA exam should understand the four conditions that must be met for a company to accrue for a compensated absence (sick day, vacation, PTO, jury duty, etc.). Below is your mental map to help you establish a thought process for going through and assessing if the four conditions are met: #1 […]More
Cash to Accrual for Rent Revenue MCQ
Marr Corp. reported rental revenue of $2,210,000 in its cash basis federal income tax return for the year ended November 30, Year 2. Additional information is as follows: Rents receivable – November 30, Year 2 $ 1,060,000 Rents receivable – November 30, Year 1 800,000 Uncollectible rents written off during the fiscal year 30,000 Under […]More
Should I memorize the formulas for BEC?
In short, the answer to that question is NO! Yes, you need to be familiar with the formulas and you could see MCQs that require you to plug numbers into a formula. Is there a better way to remember than formulas than memorizing them? The answer to that questions is YES. Always think beyond the […]More
What is off-site mirrored web hosting?
Off-site mirrored web hosting is critical for companies that have an ecommerce presence. The company would have a on-site hosting and would replicate all of their data at the off-site host. If the main site faces interruption or goes down, the off-site picks up hosting duties and the ecommerce website would not go down.More