Exam 9: Reporting Principles and Preparation of Fund Financial Statements

Which of the following are attributes of a special purpose government that is considered a primary government? -Another primary government appoints a majority of the special government's board.

Which of the following are attributes of a special purpose government that is considered a primary government? -Legally separate

Prepare entries to record the following transactions, showing which funds are affected. If a transaction affects more than one fund, prepare entries for all affected funds. a. The county adopts the following budget for its General Fund on January 1, 2020. Estimated revenues: Property taxes \ 520,000 Sales taxes 80,000 Appopriations: Salaries 480,000 Supplies and other 60,000 Transfer to Debt Service Fund 50,000 b. The county sends property tax invoices to all property owners. To raise the needed $520,000, the county sends tax bills for $525,000, anticipating that some will not pay. c. Property owners pay taxes amounting to $500,000. The county writes off $5,000 in taxes as uncollectible. The remaining taxpayers are declared delinquent, and the county adds interest and penalties of $1,000 to their tax bills. The county believes that all delinquent taxpayers will pay their bills between April 1 and June 30, 2021. d. The county issues a purchase order for $22,000 to acquire a police sedan. It charges the General Fund appropriation for "supplies and other." e. The police sedan arrives in good order, together with an invoice for $21,000. The supplier says he got a good deal on the price, so he is passing to reduced cost on to the county. The county approves the invoice for payment. f. Debt service of $50,000 (interest of $20,000 and bond principal of $30,000) comes due. The debt service will be paid out of the Debt Service Fund. g. The General Fund transfers $50,000 cash to the Debt Service Fund, and the Debt Service Fund immediately makes payment of the debt service. h. The county needs two sanitation trucks. It decides to finance the trucks by issuing 10-year bonds. The bond proceeds, amounting to $200,000, are deposited in the Capital Projects Fund.

Financial statements for fiduciary funds require major fiduciary funds to be reported in separate columns and all nonmajor funds to be reported aggregately in one column.

Which of the following are attributes of a special purpose government that is considered a primary government? -Fiscally dependent on another state or local government

Minimum financial reporting requirements for general purpose external financial reports consist of an introductory section, government-wide financial statements, fund financial statements, and notes to the financial statements.

Basic financial statements consist of government-wide financial statements and fund financial statements for governmental funds, proprietary funds, and fiduciary funds.

Where in the financial report should required supplementary information (RSI) other than Management's Discussion and Analysis be presented?

What is the meaning of the net position component called "net investment in capital assets" (which appears in proprietary fund financial statements)?

Which of the following are attributes of a special purpose government that is considered a primary government? -Independent authority to approve its own budget

When preparing governmental fund financial statements for a city, the General Fund is considered a major fund.

Following is the trial balance of City of Peachville's General Fund at December 31, 2019. Prepare: (a) closing entries; (b) a post-closing trial balance; (c) a statement of revenues, expenditures, and changes in fund balance for the year ended December 31, 2019; and (d) a balance sheet at December 31, 2019. Debits Credits Cash \ 20,000 Property taxes receivable 30,000 Due from other funds 10,000 Vouchers payable \ 15,000 Unassigned fund balance, January 1,2019 25,000 Revenues-property taxes 325,000 Revenues-other 35,000 Expenditures-salaries 280,000 Expenditures-materials 20,000 Transfer out to Debt Service Fund 40,000 Encumbrances-materials 4,000 Budgetary fund balance reserved for encumbrances 4,000 stimated revenues--property taxes 325,000 Estimated revenues-other 40,000 Appropriations-salaries 290,000 Appropriations-materials 25,000 Appropriations-transfer out to Debt Service Fund 40,000 Budgetary fund balance Totals

How are prepaid items and inventory reported in the fund balance section of governmental funds balance sheets?

An important part of management's discussion and analysis is management's forecast and projections regarding what could occur in the future if certain current unknown, but plausible, events occur.

Which of the following is a required note disclosure regarding interfund transfers?

Martin Township decides to construct a new city hall. Based on the following data, prepare a statement of revenues, expenditures, and changes in fund balance for Martin Township's Capital Projects Fund. All transactions occur within the calendar year 2020. a. The Fund starts and ends the year with a zero fund balance. b. The Fund's financing sources for the city hall project were: long-term bond proceeds - $5 million; operating transfer from the General Fund - $2 million; state grant - $1 million; interest from the temporary investment of cash - $70,000. c. Total outlays for constructing the new city hall were: construction costs - $7,200,000; design and construction supervision fees - $600,000. d. City laws require that, whenever bonds are used, any remaining difference between total financing sources and construction costs must be transferred to the Debt Service Fund. Therefore, $270,000 was transferred to the Debt Service Fund.

Which of the following are attributes of a special purpose government that is considered a primary government? -Authority to issue its own bonded debt

Financial information for each major fund is presented in a separate column of the fund financial statements.

Which of the following are attributes of a special purpose government that is considered a primary government? -Separately elected governing body

Which of the following items (where applicable) is required to be reported as required supplementary information (RSI)?