Question 1

Expenditures are never recorded in governmental funds.

Accepted Answer

A) True 
 B)False  False

Question 2

The basis of accounting that should be used in preparing fund financial statements is:

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 C

Question 3

Reporting fund financial information in separate columns for each major fund and aggregate information for nonmajor funds

Accepted Answer

A)  Means that only those funds that meet the GASB's 10 percent and 5 percent rules are reported in separate columns. 
B)  Is optional under GAAP,but is generally required by state laws for governments. 
C)  Is the same manner of reporting used by business organizations. 
D)  Is required by generally accepted accounting principles for state and local governments. 
A)  Means that only those funds that meet the GASB's 10 percent and 5 percent rules are reported in separate columns. 
B)  Is optional under GAAP,but is generally required by state laws for governments. 
C)  Is the same manner of reporting used by business organizations. 
D)  Is required by generally accepted accounting principles for state and local governments. D

Question 4

Under the modified accrual basis of accounting,revenues should be recognized when

Accepted Answer

A)  Earned. 
B)  Collected in cash. 
C)  Authorized by the budget ordinance. 
D)  Measurable and available. 
A)  Earned. 
B)  Collected in cash. 
C)  Authorized by the budget ordinance. 
D)  Measurable and available.

Question 5

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 6

When revenues are legally restricted by external resource providers or committed by enabling legislation for particular operating purposes,a private purpose trust fund is created.

Accepted Answer

A) True 
 B)False

Question 7

Which of the following is a proprietary fund?

Accepted Answer

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

Question 8

The accounting system used by a state or local government must make it possible

Accepted Answer

A)  To present fairly the financial position and results of financial operations of the government as a whole,as well as fund financial activity in conformity with GAAP. 
B)  To prepare financial statements as required by the Financial Accounting Standards Board. 
C)  To prepare consolidated accrual basis statements for the government as a whole. 
D)  To provide Web-based bond offering statements to investment firms. 
A)  To present fairly the financial position and results of financial operations of the government as a whole,as well as fund financial activity in conformity with GAAP. 
B)  To prepare financial statements as required by the Financial Accounting Standards Board. 
C)  To prepare consolidated accrual basis statements for the government as a whole. 
D)  To provide Web-based bond offering statements to investment firms.

Question 9

The types of funds that may be used in governmental accounting are classified into the three categories of governmental,proprietary,and fiduciary.

Accepted Answer

A) True 
 B)False

Question 10

A debt service fund is used to account for financial resources segregated for the purpose of making principal and interest payments on general long-term debt.

Accepted Answer

A) True 
 B)False

Question 11

"Because budgetary accounts are used by governments,their financial statements can never be said to be in accord with generally accepted accounting principles." Comment.

Accepted Answer

This statement is not entirely accurate.

Question 12

In which of the following funds would it not be appropriate to record depreciation of capital assets?

Accepted Answer

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

Question 13

Governmental funds account for assets but not the liabilities.

Accepted Answer

A) True 
 B)False

Question 14

In accounting for state and local governments the modified accrual basis is required for

Accepted Answer

A)  Proprietary and fiduciary funds. 
B)  Governmental funds only. 
C)  Proprietary funds only. 
D)  All funds. 
A)  Proprietary and fiduciary funds. 
B)  Governmental funds only. 
C)  Proprietary funds only. 
D)  All funds.

Question 15

A deferred inflow is defined as "an acquisition of net assets by the government that is applicable to a future reporting period."

Accepted Answer

A) True 
 B)False

Question 16

A major governmental fund is one that has one or more elements (e.g.,assets,liabilities,revenues,or expenditures)that is at least:

Accepted Answer

A)  Five percent of the corresponding element(s)of total governmental funds and 10 percent of the corresponding element(s)of total governmental and enterprise funds combined. 
B)  Ten percent of the corresponding element(s)of total governmental funds and 10 percent of the corresponding element(s)of total governmental and enterprise funds combined. 
C)  Five percent of the corresponding element(s)of total governmental funds and five percent of the corresponding element(s)of total governmental and enterprise funds combined. 
D)  Ten percent of the corresponding element(s)of total governmental funds and 5 percent of the corresponding element(s)of total governmental and enterprise funds combined. 
A)  Five percent of the corresponding element(s)of total governmental funds and 10 percent of the corresponding element(s)of total governmental and enterprise funds combined. 
B)  Ten percent of the corresponding element(s)of total governmental funds and 10 percent of the corresponding element(s)of total governmental and enterprise funds combined. 
C)  Five percent of the corresponding element(s)of total governmental funds and five percent of the corresponding element(s)of total governmental and enterprise funds combined. 
D)  Ten percent of the corresponding element(s)of total governmental funds and 5 percent of the corresponding element(s)of total governmental and enterprise funds combined.

Question 17

Which of the following funds are governmental funds?

Accepted Answer

A)  General Fund,special revenue funds,capital projects funds,debt service funds,and private-purpose trust funds. 
B)  General Fund,special revenue funds,private-purpose trust funds. 
C)  General Fund,special revenue funds,debt service funds,capital projects funds,and permanent funds. 
D)  General Fund,special revenue funds,capital projects funds,debt service funds,and internal service funds. 
A)  General Fund,special revenue funds,capital projects funds,debt service funds,and private-purpose trust funds. 
B)  General Fund,special revenue funds,private-purpose trust funds. 
C)  General Fund,special revenue funds,debt service funds,capital projects funds,and permanent funds. 
D)  General Fund,special revenue funds,capital projects funds,debt service funds,and internal service funds.

Question 18

According to GASB standards transfers should be recognized

Accepted Answer

A)  When earned. 
B)  When collected in cash. 
C)  When authorized by the budget ordinance. 
D)  In the period the interfund receivable and payable arise. 
A)  When earned. 
B)  When collected in cash. 
C)  When authorized by the budget ordinance. 
D)  In the period the interfund receivable and payable arise.

Question 19

Which of the following is a difference between financial reporting for internal service and enterprise funds?

Accepted Answer

A)  Internal service funds are reported in the governmental fund financial statements. 
B)  Internal service funds are reported 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 reported 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 20

Which of the following funds would be most appropriate for 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.

Expenditures are never recorded in governmental funds.

The basis of accounting that should be used in preparing fund financial statements is:

Reporting fund financial information in separate columns for each major fund and aggregate information for nonmajor funds

Under the modified accrual basis of accounting,revenues should be recognized when

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?

When revenues are legally restricted by external resource providers or committed by enabling legislation for particular operating purposes,a private purpose trust fund is created.

Which of the following is a proprietary fund?

The accounting system used by a state or local government must make it possible

The types of funds that may be used in governmental accounting are classified into the three categories of governmental,proprietary,and fiduciary.

A debt service fund is used to account for financial resources segregated for the purpose of making principal and interest payments on general long-term debt.

"Because budgetary accounts are used by governments,their financial statements can never be said to be in accord with generally accepted accounting principles." Comment.

In which of the following funds would it not be appropriate to record depreciation of capital assets?

Governmental funds account for assets but not the liabilities.

In accounting for state and local governments the modified accrual basis is required for

A deferred inflow is defined as "an acquisition of net assets by the government that is applicable to a future reporting period."

A major governmental fund is one that has one or more elements (e.g.,assets,liabilities,revenues,or expenditures)that is at least:

Which of the following funds are governmental funds?

According to GASB standards transfers should be recognized

Which of the following is a difference between financial reporting for internal service and enterprise funds?

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

Introduction to Accounting and Financial Reporting for Governmental 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-Agency and Trust Funds

Financial Reporting of State and Local Governments

Analysis of Governmental Financial Performance

Auditing of Governmental and Not-For-Profit Organizations

Budgeting and Performance Measurement

Accounting for Not-For-Profit Organizations

Not-For-Profit Organizations-Regulatory, Taxation, and Performance Issues

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

Expenditures are never recorded in governmental funds.

The basis of accounting that should be used in preparing fund financial statements is:

Reporting fund financial information in separate columns for each major fund and aggregate information for nonmajor funds

Under the modified accrual basis of accounting,revenues should be recognized when

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?

When revenues are legally restricted by external resource providers or committed by enabling legislation for particular operating purposes,a private purpose trust fund is created.

Which of the following is a proprietary fund?

The accounting system used by a state or local government must make it possible

The types of funds that may be used in governmental accounting are classified into the three categories of governmental,proprietary,and fiduciary.

A debt service fund is used to account for financial resources segregated for the purpose of making principal and interest payments on general long-term debt.

"Because budgetary accounts are used by governments,their financial statements can never be said to be in accord with generally accepted accounting principles." Comment.

In which of the following funds would it not be appropriate to record depreciation of capital assets?

Governmental funds account for assets but not the liabilities.

In accounting for state and local governments the modified accrual basis is required for

A deferred inflow is defined as "an acquisition of net assets by the government that is applicable to a future reporting period."

A major governmental fund is one that has one or more elements (e.g.,assets,liabilities,revenues,or expenditures)that is at least:

Which of the following funds are governmental funds?

According to GASB standards transfers should be recognized

Which of the following is a difference between financial reporting for internal service and enterprise funds?

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

Introduction to Accounting and Financial Reporting for Governmental 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-Agency and Trust Funds

Financial Reporting of State and Local Governments

Analysis of Governmental Financial Performance

Auditing of Governmental and Not-For-Profit Organizations

Budgeting and Performance Measurement

Accounting for Not-For-Profit Organizations

Not-For-Profit Organizations-Regulatory, Taxation, and Performance Issues

Accounting for Colleges and Universities

Accounting for Health Care Organizations

Accounting and Reporting for the Federal Government

Filters