Like what other admins Kharla and Cedric did in the October 2013 and July 2014 board exams, I who took the CPA board exam last October 2014 will share to you my insights and previews about the exam. Para ito sa mga susunod na mga mageexam na gusting malaman kung ano ang mga nagaganap sa actual board examinations. Mahaba haba ito, so sana di kayo tamarin magbasa. :)
(Disclaimer: It might be different from what will be given in the next board exams tentatively to be held on May 2015. And it is my own observation, it might have different interpretations from others who took it. Also, I cannot post the complete actual questions, as I signed a non-disclosure agreement to the PRC not divulging the content of the exams, still it is an overview. I did this post hours after each day of the CPA board examinations.)
THEORY OF ACCOUNTS: Sabi ng ibang ka-dorm ko, galing sa ReSA preweek saka handouts yun karamihan mga tanong, consistent sa trend noong last July 2014 exams. (Taga CPAR ako kaya di ko masyadong nabasa yun sa ReSA, huhu.) Pero, I felt na sa TOA, labanan lang tlaga ng concepts. So I suggest na sapat na yun materials sa review center niyo. Mas marami pa rin kayo matatandaan kung makikinig kayo sa reviewer niyo. Maraming lumabas about the framework, financial instruments, shareholders equity, mga ilang tanong rin yun about sa EPS, preference shares saka retained earnings. May lumabas rin about service concessions (IFRIC 13) na noong preweek at actual board exam ko lang nalaman, so aside from review materials, try to read the standards and interpretations themselves kahit yun summarized lang. May konting government accounting pero ang simple lang. At walang employee benefits sa board exam ngayon.
AUDITING THEORY: Also known as “Auditing Theory and ENGLISH 1”. Paano ba naman, the Auditing Theory grammar questions introduced last July are again in this board exam. Limang tanong na proper use ng capitalization, pronouns, apostrophe saka paggamit ng active and passive voice ang lumabas. May tanong pa nga na yun other three choices are JEJEMON TEXTS. (That “K b der, 9am @ ofc, thx” choice for example.), na kung tutuusin ay bonus questions. Back to the main subject, maraming IT audit at audit sampling questions na lumabas. The rest are usual questions about audit reports and substantive procedures. For the reference, most of the questions reportedly came from Wiley. But, I think yung Salosagcol + CRC-ACE handouts sapat na rin sakin. So again, it’s all about concepts. Another tip: choose both the BEST and CORRECT answer. May tanong kasi doon na anong opinion ang ibibigay kapag may material misstatement ang FS. Di ba qualified or adverse opinion ang sagot depending on pervasiveness? Pero napilitan akong isagot ang qualified only kasi yun isa sa choices, “qualified and ADVISE opinion”. Kasi it may be the best answer, but NOT the correct one, kasi may error sa choice. Pwede kang magassume na typo error siya pero sabi nga “never assume unless otherwise stated”. Always think that your exam is correct, so if there are errors in the exams, choose the next best alternative, or if a worse error, call the attention of the watcher.
MANAGEMENT SERVICES: For me, it is one of the easiest examination in this board examination, pero DON’T be complacent because marami ring tricky questions doon. Maraming lumabas about financial statement analysis especially related to equity (EPS, dividend payout and yield, P/E ratio). May capital budgeting rin, pero ingat sa net annual cash inflows. Net income ang given, iba yun sa cash flow ah, dahil pag di mo naadd yun depreciation, damay damay yun NPV, payback period at simple rate of return mo. May budgeting rin: may computation ng budgeted production, at may collections from quarterly sales. May isang contested situational problem rin doon, about sa feasibility study budget proposal. Bumalik rin yun cost concepts, which some are theories. There were more problems this time compared to last July, albeit theories still dominated the exams. Lastly, there is one only question about economic concepts, about demand and supply. As for the reference, MAS Theories are reportedly lifted from Cabrera while the problems, CPAR handouts would be enough. May grammar question rin pala ang MAS, proper capitalization, kaya dapat talagang title nun “Management Services and ENGLISH 2”
PRACTICAL ACCOUNTING 1: Also known as “AUDITING PROBLEMS PART 1”. Bakit? Around 5 situational problems with five questions each ba naman ang binigay sa board exams. Di ba madalas pag P1, one-situation, one-problem lang, or at most dalawa? In short, mala AP talaga ang level ng questions sa P1. Actually pinaclarify ni Sir Valix of CPAR yun mga questions na iyon. Anyway, most of them are about cash flow statement, financial statement presentation, accrual to cash basis (not cash to accrual, kasi cash basis net income ang tinanong), inventory at accounts receivable. Wala dun yun “favorite topics” dun like employee benefits, at simple ang leases doon (as in operating lease lang). Another tip, tignan muna ang required bago yun situational problem. Bakit? May isang tanong dun na sobrang haba, almost one page yun may investment in equity securities + investment in associate + trademark + patent… tapos pagbuklat ko ng next page ang tanong lang pala simpleng dividend revenue. Badtrip di ba? Nasayang tuloy oras ko noon kakabasa. Lastly, don’t be careless in reading, may time kasi na computable lahat ng choice pero dahil sa isang additional information lang, nababago ang mga sagot. Ayun, kung next board exam ganun ang trend, after reviewing P1 handouts in your review center, isunod agad ang AP kasi magkarelate talaga sila. I would still recommend Valix books, dahil masasabi mo sa libro na yun na: “nasayo na ang lahat~” pero if gusto niyo ng AP level P1 questions, try Empleo’s FA books.
AUDITING PROBLEMS: “…PART 2”. One of the problems (about cash recieipts, disbursements and shortages) are very familiar with me dahil inexam ko siya dati noog undergrad ako, with the same amounts. That was lifted from the reviewer of Ocampo. (So may sure 5 points na ako. Hihi.) Pero beware, pwedeng baguhin yun tanong, so wag magkabisado ng sagot. For example, sa problem na yun, may lalabas na sagot if gross profit on cost ginamit mo at may lalabas rin pag gross profit on sales ginamit mo. So, INGAT, kasi pag nagkamali ka ng gamit, domino effect yun sa ibang related questions. Sabi naman ng isa kong classmate, may kinuha raw kay Roque. So, I would really suggest, like what I did in the review, that reading both of them are effective. May lumabas na problems about shareholders’ equity (mainly issuance of shares), revenue cut off tests, and collections and payments. May isa lang na problem na medyo nanibago ako, about investment in joint venture and operations, kung paano mo hahatiin yun assets, liabilities and equity between sa mga venturers. Lastly, may THEORIES ulit ang auditing problems, like last October 2013 board exams. Mga walo or siyam yata. Related naman ito sa substantive procedures to be taken sa different transactions like in payables and receivables, at saka sa subsequent events. WALANG PROOF OF CASH. Kaya compared raw sa July 2014, mas madali ang AP ngayon.
PRACTICAL ACCOUNTING 2: Also known as “AUDITING PROBLEMS PART 3” dahil may 4 situational problems ulit with 5 questions each. It is this board examination’s KILLER SUBJECT. It was the subject that made me cry after finishing it dahil sobrang hirap niya, at paguwi ko sa dorm binalibag ko sa sahig yun mga materials ko sa P2 sa inis. :( May isang tanong doon about business combination na aakalain mo na 3-step acquisition siya dahil akala mo magkakapangalan sila. (I am talking about Kitty Kat, Kit Kat and Kitty Kit, I know makakarelate yun iba dito). Yun pala, tatlong companies pala ang nagacquire sa iisang company. (Yun dalawa ay investment in associate, at yun isa doon subsidiary) May lumabas ulit na about joint operations or assets yata about sa yachts na akala ko hindi pagtutuunan ng pansin: this time, pinacompute sa amin yun revenue, net income at share sa kada venturer. Naiinis talaga ako kasi sobrang gulo kung ilang araw talaga yun sail-days nila, pati yun costing nila. May isang problem naman doon about partnership operations na feeling alam ng marami ang gagawin pero nakakainis kasi sobrang haba ng kailangang solution dahil dalawang taon + ang hatian pa nila average capital balances + nag-admit pa ng bagong partner. Naghahanap ako ng medyo madadaling topics sa P2 like Franchising, LTCC, Home Office & Branch, Corporate Liquidation, NPOs, Government Accounting, etc., pero WALA. Habang maraming Forex Transactions saka Forward Contract questions, Process Costing na nasa isang situational problem at dalawang Joint Costs problems. May theories na naman sa Practical Accounting 2. Doon ako nagulat, may about sa Activity Based Costing na ang alam ko part na siya ng MAS. Overall, even yung topnotchers nahirapan sa exam na yun dahil mahahaba na, nakakalito pa at habang nag eexam ako, malapit ng magtime pero walang labasan. Di tulad noong MAS, AT at TOA may nagpapasa na ng 1 1/2 hours pa lamang. Kung saan galing yun tanong, sorry, I do not know, dahil mas mahirap siya compared sa problems nina Dayag at Guerrero, na kung Level 1 yun sa libro, level 100 yun nasa exam na yun. Feeling ko self-constructed ang mga tanong kasi until now walang makapagturo ng source. Consolation na lang siguro dun yung mapaggamit nilang mga company names tulad ng Raikage at Temari ng Naruto, cast ng series na Suits, at sina June Mar (Fajardo), Andray (Blatche) at Jimmy (Alapag) + Paul (Lee) na players ng Gilas. Sabi nga ng isa kong classmate sa problem ni June Mar, sana raw sinama na nila si James Yap, PJ Simon at Marc Pingris.
BUSINESS LAW & TAXATION: The former killer subject last July 2014 doesn’t have its sting anymore, pero hindi pa rin siya gaanong kadali. Actually, may contested situational problem doon about community tax certificates or cedula dahil wala raw siya sa syllabus ng CPA board examinations. On the Tax part, may situational problem about income tax payable per quarter, dividend income, donors’ tax, pati na VAT. Theoretical lang ang Estate Taxation doon, at more focused rin ang exam sa assessments. Sa BL naman, may hustisya dahil well distributed ang mga tanong sa mga topics: may obligation, contracts, pledge, partnership, corporation at negotiable instruments. Although may mga tanong doon na medyo nakakalito. Example is kung ano ang promissory note na order to the bearer. May ilang Latin law terms na never heard sakin, tulad ng “pactum reservati dominii” or contractual reservation of title. Napa-“ano iyon” ako doon, so I suggest na dapat may legal dictionary kayo pag nagrereview. May isa pang situational problem sa BL, about sa appraisal right ng isang corporation, na kung nakinig ka noon sa lectures ng reviewer niyo, masasagot mo talaga siya. Naging sapat na sakin yun CPAR handouts at preweek on BL at Quick Notes ni Jack De Vera para makasurvive sa subject na ito. Pero dahil alam naming killer subject ang BLT last time, marami rin kaming binasa na libro doon, like ReSA handouts ni Tamayo, Soriano, etc.
—- ooo —-
Nakakawalandyo *with matching voice of Atty. D of CPAR* yun exam di ba? Dahil inexpect na namin na mahirap ang CPA board examinations tulad noong July dahil sa change ng composition of BOA, pinaghandaan talaga ng karamihan ito. Pero ang nangyari, parang standard costing: ang standard ay mahirap, pero ang actual MAS MAHIRAP pa, kaya naging UNFAVORABLE sa amin. Masasabi mo talaga na ACCOUNTING ang tunay na MAHIRAP. ACCOUNTING ang tunay na PURO PASAKIT. </3 Sabi nga ng ilan, pati ng iCPA, it was one of the toughest CPA board exams ever. (Di kasama yun time na hindi pa multiple choice ang board exam ah, mas mahirap naman yun.)
Sa lahat ng nagdasal at sumuporta, maraming maraming salamat! Sa lahat ng CPAs na, congratulations and see you sa oathtaking, testimonial dinner or baka sa work na rin. Sa mga hindi naman pinalad, di pa tapos ang laban! Balang araw, susunod na rin kayo na matutupad ang mga pangarap bilang CPA. At sa lahat ng magtatake this coming May 2015, I am wishing you all the best. Tiwala lang kay Lord plus efforts, magiging CPA ka rin.
Hello! Do you think it's worth it to spend a little to buy a button machine rather than make it online?
It depends. Of the three of us behind AAtoast!, only two have made buttons for sale, and only one has a button maker. And I wouldn’t say any of us have buttons as our main products.
What you want to do, with any sort of major equipment purchase or investment, is undertake a cost-benefit analysis and a payback or break even analysis. Fancy terms, but basically, figure out if it’s worth it for you. And you can apply these principles to anything you are considering to invest in, not just buttons and button makers.
Cost benefit analysis
What are the options you have in terms of achieving a result - in this case, turning your art into buttons for sale? Example: Buy a machine and make them, or pay someone else to do it.
What is involved in each option? What are the pros and cons of each? Can you quantify them?
Example processes for each option: For a button maker machine, you have to source and buy the actual machine, as well as parts, and also a tool to punch circles out of your artwork. You also have to print your own artwork.
If you pay someone else to do it, you’ll need to send money for production and shipping.
Example pros: If you buy a machine, you have full control over the process, you can do it whenever you want and don’t have to wait, you don’t have to pay someone else for their time so you can have a bigger potential profit per button (once you’ve paid off the costs of the machine/tools of course). And maybe you don’t need to worry about buying/making a minimum number of buttons. Maybe the machine will offer flexibility to do different sizes or different products too, not just buttons, so you can eventually expand your product line.
Example cons: The upfront cost of the machine is expensive, and you have to buy parts every time. It will also take your own time and energy to make the buttons yourself.
Quantifying these things:
What’s the cost of the machine? Cost of the button parts and any other tools you need?
How much do you plan on selling your buttons for?
How many buttons do you want to make? How many buttons can you sell/do you think you can sell?
How much does it cost you to pay someone else to make those buttons?
How much will it cost you to make the buttons? (If you care to get into that much detail, how much time does it take you to make the buttons? And what is your time worth?)
Are you going to use the button maker for other things that would also help to justify the cost of ownership?
How long does it take for you to get buttons made by someone else, versus making buttons yourself?
Payback or break even analysis
Basically, when will you make back the cost of your machine? There are actual formulas for payback period/time, but they’re pretty complicated and deal with time factors that aren’t as useful/relevant here (especially because artist alley doesn’t really offer a predictable framework in terms of time and money made).
Fixed Costs/(Price - Variable Costs) = Breakeven Point in Units Sold
Here’s an example with random numbers I made up (make sure you use real numbers for your own situation, and don’t forget things like taxes and shipping in your costs):
Your fixed costs are the cost of the button maker and any tools you need to go with it. Let’s say it was $450.
Your price is how much you want to sell a button for, and your variable costs are the time and materials it takes to make each individual button. Let’s say you want to sell your buttons for $2.
It takes you 3 minutes to make a button and Ontario minimum wage is (will be) $11.25/hour, so let’s say about 60 cents of your time (you could skip this if you don’t care as much about time, which is the case if it’s a hobby).
Let’s pretend button parts are 10 cents each, so with your labour, that’s total 70 cents for variable costs.
Also don’t forget cost of printing the artwork - again, if you print at home or on a borrowed printer, it could be minimal, especially since you can print a lot of buttons up on one sheet of paper. (I don’t want to do any more math so we’ll pretend here that you borrowed a friend’s printer so it cost you nothing.)
$450 divided by ($2 - 0.70) = 346.15. In other words, you will have to sell 347 buttons before you make back the cost of your button machine.
You can run the formula again with your other option (paying someone else to do it), and compare.
If the numbers look feasible to you, then go for it! If it’s just a hobby and you want the convenience of making buttons yourself anytime, then that works too. Some people do buy a machine and then sell button making services to other people, so if you’re particularly enterprising that’s another option to pay it off/increase income. And finally, if you already foresee using the button maker for lots of other things unrelated to making buttons to sell (for gifts, non-artist alley events, whatever), then that’s another reason to consider investing in one.
Last but certainly not least, one more thing to take into consideration is your own physical capabilities. The operation of the machine does create arm and wrist strain from repetition. Doing a few at a time is okay, but when you start getting into a lot of buttons you’ll feel it physically (but we suppose a plus is that you’ll have one great forearm).