 forehead in this session we would look at actual exam and actual CPA questions from the reg section. As always, I would like to remind you to connect with me on LinkedIn. If you haven't done so, YouTube is where you would need to subscribe. I have 1500 plus accounting, audit, and tax, and finance lectures. This is a list of all the courses that I covered, including income tax. On my website, you will find additional information such as notes, PowerPoint slides, multiple choice through false, as well as other CPA materials such as 2000 plus CPA questions. So what I'm going to do next, I'm going to go to the AI CPA website and show you the actual exam. So this way on the exam day, you will be comfortable and ready to take the exam. So you got to prepare yourself mentally in order to take the exam. So this is the exam itself. When you log in, they're going to give you this policy policy statement and confidentiality agreement section information. You don't want to waste any time. Just click on accept and begin the exam. And here we go. They tell you how many, but first you want to kind of like a roadmap. You have 30, you have Tesla one, Tesla two, Tesla three, Tesla four, and Tesla five. You can take a break. You can take a break, timer plus for 15 minutes here mandatory. These are kind of optional, you know, timer continue to run. So it's up to you. You can take a break. Then you take a task-based simulation. So you have two multiple choice and a task-based simulation. So in this session, I will take you through a multiple choice option. So you click on accept and begin. You want to know this before you set for the exam, accept and begin. And this is the first question. So the first question read, a spouse died on December 31st, year one. The couple had no dependent. What should be the filing status of the surviving spouse in year two? So a spouse died in year one. Okay. And but they're asking you about year two. So you have to be very careful. Let me, if they ask you about year one, what will be the filing status for year one? The filing status for year one will be married filing jointly. However, the couple had no dependent. What should be the filing status for year two? Year two, they go back to single because they have no dependent. If they have the dependent, they can do marry with the word with or with the word for two years, assuming you have a child. So notice here you have a calculator Excel overview and help section. So you're done with this question. You can go to the next one. Let's take a look at this question under a divorce settlement. Joanne transferred her 50% ownership of their personal residency to Jim. The joint basis of the residency is 200,000. At the time of the transfer, the property fair market value was 300,000. What was Joanne's recognized gain in Jim basis in the residency? Well, when we have a divorce, the basis transfer, therefore the $200,000 basis transfer, therefore the basis are 200,000. And there is no recognized gain. There is no recognized gain or loss. Therefore the answer is zero for recognized gain 200,000 for the basis. You want to know, you want to make sure you know this rule. This is an easy question for the exam. Question three, what amount of depreciation can Baker deduct in the current year? On May 1st for the current year, Baker purchased equipment with a five-year useful life for a cost of 10,000. So for example, now you just write down cost of 10,000. Baker adopted Baker's depreciation and did not utilize any special depreciation deduction. On March 1st of the current year, so they bought it last year, now it's the current year, Baker sold the equipment. The Baker depreciation schedule for five-year property is as below first year 20%, second year 32%, third year 19%. What amount of depreciation can they take? Well, you can pull the calculator. You would say, okay, 10,000 is the cost, 10,000 is the cost times 0.32, that's equal to 3,200. So one of the answers is 3,200, but we have to be careful. We did not have the asset for the full year. So what happened? Now be careful, don't multiply it by 212 because if you multiply it by 212, you're going to get the answer. So if you multiply this by 212, you're going to get the answer 533. Why 212? Because you're going to assume it in January and February. Remember, this is tax, this is not financial reporting. We assume a half year. We assume you sold it halfway throughout the year. So you multiply it by 0.5 and the answer is 1,600. 1,600. Let's take a look at this question. Green is the sole shareholder by Siegel Corporation, which is an S corporation. Green basis at the beginning of the year is 15,000. So we need a calculator for this question. Siegel reported ordinary loss of 5,000. In 2000, municipal bond interest for the year, Siegel distributed cash of 6,000 to Green on November 1st. What is Green basis at the end of the year? Well, let's start. That's clear. We have 15,000 to start with. This is the basis. We incur the loss. It's going to reduce our basis. Then we had the 2000 municipal bond interest that's going to increase our basis. Then we had cash distribution of 6,000 that's going to reduce our basis. Whoops, too many zeros. So 6,000 is the answer. We can click to the next question. The internal revenue code and the regulation do not be careful. Do not impose penalties on the tax preparers for which of the following. And here on the tax preparers. So you need to know the rules for the tax preparers. Failure to sign a prepared tax return is a tax preparer. Yes, if you prepare that, you have to sign it. Otherwise, you'll be penalty will be imposed. So that's definitely penalty will be imposed. And notice here that the time will be running down by the way. Failure to provide a copy of the of a prepared tax return to the taxpayer. Yes, you cannot withhold that. You have to do that. You have to do so. Failure to notify a taxpayer about inadvertent error on a tax return 10 years ago. You don't have to go that far. Okay, so that's you're not going to be charged a penalty. But let's take a look at the last question. Failure to return copies of the prepared tax return or a list of the taxpayers for whom such return were prepared for the last three years. Well, yes, your failure to return in the past three years, you have to keep them. So the answer is failure to notify the taxpayer. And basically, once you are done, you can submit your answers and move on to the next Tesla. So in the next session, I would work on the next Tesla just going to give you an idea. So this is a this is a practice for you to see what the exam looks like. And we had the chance to answer five questions in the next session. Hopefully we'll answer another five questions. As always, I would like to remind you if you're invested in your CPA exam, you can visit my website for additional resources and lectures and resources. It's an investment in your career. You'll do this once in your lifetime. Make sure you do it right. I'm here to help you. Good luck and stay motivated.