Question 1

Under the modified accrual basis of accounting, gains and losses on disposal of fixed assets

Accepted Answer

A) are not recognized. 
B) are recognized when the proceeds cash of the sale are received on the installment basis. 
C) are recognized only if there is a gain. 
D) are recognized when the sale occurs, regardless of when the cash is collected. 
A) are not recognized. 
B) are recognized when the proceeds cash of the sale are received on the installment basis. 
C) are recognized only if there is a gain. 
D) are recognized when the sale occurs, regardless of when the cash is collected.

Question 2

A city that has a 12/31 fiscal year end has adopted a policy of recognizing the maximum amount of property tax revenue allowable under GAAP.Property taxes of $720,0000 of which 10% are estimated to be uncollectible are levied in October 2010 to finance the activities of the fiscal year 2011.During 2011, cash collections related to property taxes levied in October 2010 were $600,000.In 2012 the following amounts related to the property taxes levied in October 2010 were collected: January $30,000; March, $6,000.For the fiscal year ended 12/31/11, what amount should be recognized as property tax revenues related to the 2010 levy on the governmental fund financial statements?

Accepted Answer

A)  $720,000. 
B)  $648,000. 
C)  $630,000. 
D)  $600,000. 
A)  $720,000. 
B)  $648,000. 
C)  $630,000. 
D)  $600,000.

Question 3

At the beginning of its fiscal year, a local government owned an investment with a historical cost of $85 and a fair value of $95.During the year, dividends of $2 were received.At the end of the year, the investment had a fair value of $100.The amount that should be recognized on the governmental fund financial statements for the year as investment income is

Accepted Answer

A) $-0-. 
B) $7. 
C) $15. 
D) $17. 
A) $-0-. 
B) $7. 
C) $15. 
D) $17.

Question 4

Under GAAP, property taxes levied in one fiscal period to finance the activities of the following fiscal period are recognized as revenue in the governmental fund financial statements

Accepted Answer

A)  in the year levied. 
B)  in the year for which they are intended to finance the activities. 
C)  when collected, regardless of when levied. 
D)  in the year for which they are intended to finance the activities, if collected within that period or within a period no greater than 60 days after the close of the fiscal year. 
A)  in the year levied. 
B)  in the year for which they are intended to finance the activities. 
C)  when collected, regardless of when levied. 
D)  in the year for which they are intended to finance the activities, if collected within that period or within a period no greater than 60 days after the close of the fiscal year.

Question 5

As used in defining the modified accrual basis of accounting, the term "available" means

Accepted Answer

A) received in cash. 
B) will be received in cash within 60 days of year-end. 
C) collection in cash is reasonably assured. 
D) collected within the current period or expected to be collected soon enough thereafter to be used to pay liabilities of the current period. 
A) received in cash. 
B) will be received in cash within 60 days of year-end. 
C) collection in cash is reasonably assured. 
D) collected within the current period or expected to be collected soon enough thereafter to be used to pay liabilities of the current period.

Question 6

A city that has a 12/31 fiscal year end has adopted a policy of recognizing the maximum amount of property tax revenue allowable under GAAP.Property taxes of $720,0000 of which 10% are estimated to be uncollectible are levied in October 2010 to finance the activities of the fiscal year 2011.During 2011, cash collections related to property taxes levied in October 2010 were $600,000.In 2012 the following amounts related to the property taxes levied in October 2010 were collected: January $30,000; March, $6,000.For the fiscal year ended 12/31/11, what amount should be recognized as property tax revenues related to the 2010 levy on the government-wide financial statements?

Accepted Answer

A) $720,000. 
B) $648,000. 
C) $630,000. 
D) $600,000. 
A) $720,000. 
B) $648,000. 
C) $630,000. 
D) $600,000.

Question 7

A city receives a $150,000 grant from the state to purchase vans to transport physically challenged individuals.During the current year the city receives the entire $150,000 and purchases one bus for $65,000 and issues a purchase order for another van for $60,000.The grant revenue that the city should recognize on the government-wide financial statements in the current year is

Accepted Answer

A)  $-0-. 
B)  $ 65,000. 
C)  $125,000. 
D)  $150,000. 
A)  $-0-. 
B)  $ 65,000. 
C)  $125,000. 
D)  $150,000.

Question 8

Taxes that are imposed on the reporting government's citizens are considered general revenues, even if they are restricted to specific programs.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following is not characterized as non-exchange?

Accepted Answer

A) Sales taxes 
B) Property taxes 
C) Fines and forfeits 
D) Charges for services 
A) Sales taxes 
B) Property taxes 
C) Fines and forfeits 
D) Charges for services

Question 10

For fund financial statements, the measurement focus and basis of accounting used by governmental fund types are

Accepted Answer

A) current financial resources and modified accrual accounting. 
B) economic resources and modified accrual accounting. 
C) financial resources and full accrual accounting. 
D) economic resources and full accrual accounting. 
A) current financial resources and modified accrual accounting. 
B) economic resources and modified accrual accounting. 
C) financial resources and full accrual accounting. 
D) economic resources and full accrual accounting.

Question 11

Under the accrual basis of accounting, imposed nonexchange revenues such as fines should be recognized

Accepted Answer

A) when assessed. 
B) when the government has an enforceable legal claim. 
C) when collected. 
D) when the government has an enforceable legal claim and when the collected within the current period or soon enough thereafter to be used to pay the liabilities of the current period 
A) when assessed. 
B) when the government has an enforceable legal claim. 
C) when collected. 
D) when the government has an enforceable legal claim and when the collected within the current period or soon enough thereafter to be used to pay the liabilities of the current period

Question 12

Which of the following is a derived tax revenue?

Accepted Answer

A) Income taxes 
B) Sales taxes 
C) Both of the above 
D) Neither of the above 
A) Income taxes 
B) Sales taxes 
C) Both of the above 
D) Neither of the above

Question 13

Under GAAP, property taxes levied in one fiscal period to finance the activities of the following fiscal period are recognized as revenue in the government-wide financial statements

Accepted Answer

A)  in the year levied. 
B)  in the year for which they are intended to finance the activities. 
C)  when collected, regardless of when levied. 
D) in the year for which they are intended to finance the activities, if collected within that period or within a period no greater than 60 days after the close of the fiscal year. 
A)  in the year levied. 
B)  in the year for which they are intended to finance the activities. 
C)  when collected, regardless of when levied. 
D) in the year for which they are intended to finance the activities, if collected within that period or within a period no greater than 60 days after the close of the fiscal year.

Question 14

Under the accrual basis of accounting, property tax revenues are recognized

Accepted Answer

A) when they are received in cash. 
B) in the year for which they were levied. 
C) in the year for which they were levied and when collection in cash is reasonably assured. 
D) they are available to finance expenditures of the fiscal period. 
A) when they are received in cash. 
B) in the year for which they were levied. 
C) in the year for which they were levied and when collection in cash is reasonably assured. 
D) they are available to finance expenditures of the fiscal period.

Question 15

Income taxes are classified as ad valorem taxes.

Accepted Answer

A) True 
 B)False

Question 16

The modified accrual basis of accounting is used in presenting the fund financial statements of the governmental funds because

Accepted Answer

A) it is the superior method of accounting for the economic resources of any entity. 
B) it provides information as to the extent the entity achieved interperiod equity. 
C) it is budget oriented while facilitating comparisons among entities. 
D) it results in accounting measurements based on the substance of transactions. 
A) it is the superior method of accounting for the economic resources of any entity. 
B) it provides information as to the extent the entity achieved interperiod equity. 
C) it is budget oriented while facilitating comparisons among entities. 
D) it results in accounting measurements based on the substance of transactions.

Question 17

The revenue-recognition issues facing governments are generally focused on the exchange transaction earning process, similar to those of businesses.

Accepted Answer

A) True 
 B)False

Question 18

Under the accrual basis of accounting used by governments, investment revenues for the current period should include

Accepted Answer

A) only interest and dividends received. 
B) all interest and dividends received during the period plus all accruals of interest and dividends earned. 
C) all interest and dividends received plus gains and losses on securities that were sold during the period. 
D) all interest and dividends received, all gains and losses on securities sold and all changes in market values on securities held in the portfolio at year-end. 
A) only interest and dividends received. 
B) all interest and dividends received during the period plus all accruals of interest and dividends earned. 
C) all interest and dividends received plus gains and losses on securities that were sold during the period. 
D) all interest and dividends received, all gains and losses on securities sold and all changes in market values on securities held in the portfolio at year-end.

Under the modified accrual basis of accounting, gains and losses on disposal of fixed assets

Under GAAP, property taxes levied in one fiscal period to finance the activities of the following fiscal period are recognized as revenue in the governmental fund financial statements

As used in defining the modified accrual basis of accounting, the term "available" means

Taxes that are imposed on the reporting government's citizens are considered general revenues, even if they are restricted to specific programs.

Which of the following is not characterized as non-exchange?

For fund financial statements, the measurement focus and basis of accounting used by governmental fund types are

Under the accrual basis of accounting, imposed nonexchange revenues such as fines should be recognized

Which of the following is a derived tax revenue?

Under GAAP, property taxes levied in one fiscal period to finance the activities of the following fiscal period are recognized as revenue in the government-wide financial statements

Under the accrual basis of accounting, property tax revenues are recognized

Income taxes are classified as ad valorem taxes.

The modified accrual basis of accounting is used in presenting the fund financial statements of the governmental funds because

The revenue-recognition issues facing governments are generally focused on the exchange transaction earning process, similar to those of businesses.

Under the accrual basis of accounting used by governments, investment revenues for the current period should include

The Government and Not-For-Profit Environment

Fund Accounting

Issues of Budgeting and Control

Recognizing Expenditures in Governmental Funds

Accounting for Capital Projects and Debt Service

Capital Assets and Investments in Marketable Securities

Long-Term Obligations

Business-Type Activities

Fiduciary Funds and Permanent Funds

Issues of Reporting, Disclosure, and Financial Analysis

Not-For-Profit Organizations

Colleges and Universities

Health Care Providers

Managing for Results

Auditing Governments and Not-For-Profit Organizations

Federal Government Accounting

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Exam 4: Recognizing Revenues in Governmental Funds

Under the modified accrual basis of accounting, gains and losses on disposal of fixed assets

Under GAAP, property taxes levied in one fiscal period to finance the activities of the following fiscal period are recognized as revenue in the governmental fund financial statements

As used in defining the modified accrual basis of accounting, the term "available" means

Taxes that are imposed on the reporting government's citizens are considered general revenues, even if they are restricted to specific programs.

Which of the following is not characterized as non-exchange?

For fund financial statements, the measurement focus and basis of accounting used by governmental fund types are

Under the accrual basis of accounting, imposed nonexchange revenues such as fines should be recognized

Which of the following is a derived tax revenue?

Under GAAP, property taxes levied in one fiscal period to finance the activities of the following fiscal period are recognized as revenue in the government-wide financial statements

Under the accrual basis of accounting, property tax revenues are recognized

Income taxes are classified as ad valorem taxes.

The modified accrual basis of accounting is used in presenting the fund financial statements of the governmental funds because

The revenue-recognition issues facing governments are generally focused on the exchange transaction earning process, similar to those of businesses.

Under the accrual basis of accounting used by governments, investment revenues for the current period should include

The Government and Not-For-Profit Environment

Fund Accounting

Issues of Budgeting and Control

Recognizing Expenditures in Governmental Funds

Accounting for Capital Projects and Debt Service

Capital Assets and Investments in Marketable Securities

Long-Term Obligations

Business-Type Activities

Fiduciary Funds and Permanent Funds

Issues of Reporting, Disclosure, and Financial Analysis

Not-For-Profit Organizations

Colleges and Universities

Health Care Providers

Managing for Results

Auditing Governments and Not-For-Profit Organizations

Federal Government Accounting

Filters