Question 1

Which of the following funds would record depreciation of capital assets?

Accepted Answer

A)  Special revenue fund. 
B)  Permanent fund. 
C)  Internal service fund. 
D)  Custodial fund. 
A)  Special revenue fund. 
B)  Permanent fund. 
C)  Internal service fund. 
D)  Custodial fund.

Question 2

The General Fund is the only fund that can have a positive unassigned fund balance.

Accepted Answer

A) True 
 B)False

Question 3

Which of the following is a primary objective of financial reporting by state and local governments?

Accepted Answer

A)  To provide information that can be used for capital allocation decisions made by external investors. 
B)  To report on the legal requirements imposed on the government by its elected officials. 
C)  To provide information that can be used to assess a government's accountability. 
D)  To fulfill the government's statutory duty to report on cash received and cash disbursed. 
A)  To provide information that can be used for capital allocation decisions made by external investors. 
B)  To report on the legal requirements imposed on the government by its elected officials. 
C)  To provide information that can be used to assess a government's accountability. 
D)  To fulfill the government's statutory duty to report on cash received and cash disbursed.

Question 4

The basis of accounting that should be used in preparing fund financial statements is: $$\begin{array} { | l | l | l | } 
\hline \text { Cuvernuental funds } & \text { Proprietary funds } & \text { Fiduciary funds } \
\hline \text { A) Modified accrual } & \text { Accrual } & \text { Modified accrual } \
\hline \text { B) Modified accrual } & \text { Modified accrual } & \text { Modified accrual } \
\hline \text { C) Modified accrual } & \text { Accrual } & \text { Accrial } \
\hline \text { D) Accrual } & \text { Accrual } & \text { Accrual } \
\hline
\end{array}$$

Accepted Answer

A)  Choice A 
B)  Choice B 
C)  Choice C 
D)  Choice D 
A)  Choice A 
B)  Choice B 
C)  Choice C 
D)  Choice D

Question 5

According to the GASB definition, which of the following represents an inflow of resources?

Accepted Answer

A)  Expenditures. 
B)  Revenues. 
C)  Assets. 
D)  Deferred inflows. 
A)  Expenditures. 
B)  Revenues. 
C)  Assets. 
D)  Deferred inflows.

Question 6

Which of the following funds would be most appropriate when accounting for an activity that provides goods or services to the public for a fee that is intended to make the activity self-supporting?

Accepted Answer

A)  Investment trust fund. 
B)  Enterprise fund. 
C)  Internal service fund. 
D)  Special revenue fund. 
A)  Investment trust fund. 
B)  Enterprise fund. 
C)  Internal service fund. 
D)  Special revenue fund.

Question 7

Which of the following funds should be used if resources provided by a federal grant must be segregated and used for counseling of youthful offenders?

Accepted Answer

A)  Private-purpose trust fund. 
B)  Enterprise fund. 
C)  Internal service fund. 
D)  Special revenue fund. 
A)  Private-purpose trust fund. 
B)  Enterprise fund. 
C)  Internal service fund. 
D)  Special revenue fund.

Question 8

Governments can, in part, demonstrate operational accountability by reporting proprietary and fiduciary fund financial information, as well as all government-wide financial information, using an economic resources measurement focus and the accrual basis of accounting.

Accepted Answer

A) True 
 B)False

Question 9

Governmental funds account for assets but not the liabilities.

Accepted Answer

A) True 
 B)False

Question 10

Nonmajor funds are not reported on the fund financial statements.

Accepted Answer

A) True 
 B)False

Question 11

Deferred inflow of resources and deferred outflow of resources would be shown in separate sections of a government's statement of net position.

Accepted Answer

A) True 
 B)False

Question 12

The GASB requires budget-to-actual comparison information for which of the following?

Accepted Answer

A)  The General Fund. 
B)  All governmental funds. 
C)  The General Fund and major special revenue funds with legally adopted budgets. 
D)  All special revenue, debt service and capital projects funds with legally adopted budgets. 
A)  The General Fund. 
B)  All governmental funds. 
C)  The General Fund and major special revenue funds with legally adopted budgets. 
D)  All special revenue, debt service and capital projects funds with legally adopted budgets.

Question 13

Governmental activities include the core services provided by a government, such as public safety.

Accepted Answer

A) True 
 B)False

Question 14

Capital assets used by an enterprise fund should be accounted for in the

Accepted Answer

A)  Enterprise fund and depreciation on the capital assets should be recorded. 
B)  Business-type activities journal but no depreciation on the capital assets should be recorded. 
C)  Governmental activities journal and depreciation on the capital assets should be recorded. 
D)  Enterprise fund but no depreciation on the capital assets should be recorded. 
A)  Enterprise fund and depreciation on the capital assets should be recorded. 
B)  Business-type activities journal but no depreciation on the capital assets should be recorded. 
C)  Governmental activities journal and depreciation on the capital assets should be recorded. 
D)  Enterprise fund but no depreciation on the capital assets should be recorded.

Question 15

Which of the following funds is a governmental fund-type?

Accepted Answer

A)  Private-purpose trust fund. 
B)  Internal service fund. 
C)  Permanent fund. 
D)  Enterprise fund. 
A)  Private-purpose trust fund. 
B)  Internal service fund. 
C)  Permanent fund. 
D)  Enterprise fund.

Question 16

Which of the following is True regarding financial reporting for internal service funds?

Accepted Answer

A)  Internal service funds are reported in the governmental fund financial statements. 
B)  Internal service funds are aggregated and reported as a major fund in the proprietary fund financial statements. 
C)  Internal service funds are generally reported in the Business-type Activities column of the government-wide financial statements. 
D)  Internal service funds are generally reported in the Governmental Activities column of the government-wide financial statements. 
A)  Internal service funds are reported in the governmental fund financial statements. 
B)  Internal service funds are aggregated and reported as a major fund in the proprietary fund financial statements. 
C)  Internal service funds are generally reported in the Business-type Activities column of the government-wide financial statements. 
D)  Internal service funds are generally reported in the Governmental Activities column of the government-wide financial statements.

Question 17

Explain the difference between measurement focus and basis of accounting. Also, explain the difference between the economic resources measurement focus and the current financial resources measurement focus as well as the difference between the accrual and modified accrual bases of accounting. Which funds and government-wide activities use each focus and each basis?

Accepted Answer

Measurement focus describes what is meas

Question 18

Activities a local government can engage in are classified as governmental, business-type, or fiduciary.

Accepted Answer

A) True 
 B)False

Question 19

Financial resources set aside to pay principal and interest on general long-term debt may be accounted for in which of the following fund types?

Accepted Answer

A)  Private-purpose trust fund. 
B)  Debt service fund. 
C)  Principal and interest trust fund. 
D)  Internal service fund. 
A)  Private-purpose trust fund. 
B)  Debt service fund. 
C)  Principal and interest trust fund. 
D)  Internal service fund.

Question 20

Governmental funds are identical to governmental activities, proprietary funds are identical to business-type activities, and fiduciary funds are identical to fiduciary activities of a government.

Accepted Answer

A) True 
 B)False

Which of the following funds would record depreciation of capital assets?

The General Fund is the only fund that can have a positive unassigned fund balance.

Which of the following is a primary objective of financial reporting by state and local governments?

According to the GASB definition, which of the following represents an inflow of resources?

Which of the following funds would be most appropriate when accounting for an activity that provides goods or services to the public for a fee that is intended to make the activity self-supporting?

Which of the following funds should be used if resources provided by a federal grant must be segregated and used for counseling of youthful offenders?

Governments can, in part, demonstrate operational accountability by reporting proprietary and fiduciary fund financial information, as well as all government-wide financial information, using an economic resources measurement focus and the accrual basis of accounting.

Governmental funds account for assets but not the liabilities.

Nonmajor funds are not reported on the fund financial statements.

Deferred inflow of resources and deferred outflow of resources would be shown in separate sections of a government's statement of net position.

The GASB requires budget-to-actual comparison information for which of the following?

Governmental activities include the core services provided by a government, such as public safety.

Capital assets used by an enterprise fund should be accounted for in the

Which of the following funds is a governmental fund-type?

Which of the following is True regarding financial reporting for internal service funds?

Activities a local government can engage in are classified as governmental, business-type, or fiduciary.

Financial resources set aside to pay principal and interest on general long-term debt may be accounted for in which of the following fund types?

Governmental funds are identical to governmental activities, proprietary funds are identical to business-type activities, and fiduciary funds are identical to fiduciary activities of a government.

Introduction to Accounting and Financial Reporting for Government and Not-for-Profit Entities

Governmental Operating Statement Accounts; Budgetary Accounting

Accounting for Governmental Operating Activities–Illustrative Transactions and Financial Statements

Accounting for General Capital Assets and Capital Projects

Accounting for General Long-Term Liabilities and Debt Service

Accounting for the Business-type Activities of State and Local Governments

Accounting for Fiduciary Activities—Custodial and Trust Funds

Financial Reporting of State and Local Governments

Analysis of Government Financial Performance

Auditing of Government and Not-for-Profit Organizations

Budgeting and Performance Measurement

Not-for-Profit Organizations—Regulatory, Taxation, and Performance Issues

Accounting for Not-for-Profit Organizations

Accounting for Colleges and Universities

Accounting for Health Care Organizations

Accounting and Reporting for the Federal Government

Filters

Exam 2: Principles of Accounting and Financial Reporting for State and Local Governments

Which of the following funds would record depreciation of capital assets?

The General Fund is the only fund that can have a positive unassigned fund balance.

Which of the following is a primary objective of financial reporting by state and local governments?

According to the GASB definition, which of the following represents an inflow of resources?

Which of the following funds would be most appropriate when accounting for an activity that provides goods or services to the public for a fee that is intended to make the activity self-supporting?

Which of the following funds should be used if resources provided by a federal grant must be segregated and used for counseling of youthful offenders?

Governments can, in part, demonstrate operational accountability by reporting proprietary and fiduciary fund financial information, as well as all government-wide financial information, using an economic resources measurement focus and the accrual basis of accounting.

Governmental funds account for assets but not the liabilities.

Nonmajor funds are not reported on the fund financial statements.

Deferred inflow of resources and deferred outflow of resources would be shown in separate sections of a government's statement of net position.

The GASB requires budget-to-actual comparison information for which of the following?

Governmental activities include the core services provided by a government, such as public safety.

Capital assets used by an enterprise fund should be accounted for in the

Which of the following funds is a governmental fund-type?

Which of the following is True regarding financial reporting for internal service funds?

Activities a local government can engage in are classified as governmental, business-type, or fiduciary.

Financial resources set aside to pay principal and interest on general long-term debt may be accounted for in which of the following fund types?

Governmental funds are identical to governmental activities, proprietary funds are identical to business-type activities, and fiduciary funds are identical to fiduciary activities of a government.

Introduction to Accounting and Financial Reporting for Government and Not-for-Profit Entities

Governmental Operating Statement Accounts; Budgetary Accounting

Accounting for Governmental Operating Activities–Illustrative Transactions and Financial Statements

Accounting for General Capital Assets and Capital Projects

Accounting for General Long-Term Liabilities and Debt Service

Accounting for the Business-type Activities of State and Local Governments

Accounting for Fiduciary Activities—Custodial and Trust Funds

Financial Reporting of State and Local Governments

Analysis of Government Financial Performance

Auditing of Government and Not-for-Profit Organizations

Budgeting and Performance Measurement

Not-for-Profit Organizations—Regulatory, Taxation, and Performance Issues

Accounting for Not-for-Profit Organizations

Accounting for Colleges and Universities

Accounting for Health Care Organizations

Accounting and Reporting for the Federal Government

Filters