Question 1

What is the different accounting treatment with respect to supplies inventory using the Consumption versus the Purchases method?

Accepted Answer

The consumption method is accounted for similar to business accounting; the supplies inventory account is debited upon acquisition and the expenditure is recorded when the supplies are consumed.
The purchases method records expenditures upon acquisition and an adjustment to supplies inventory at year end if inventory levels are significant.

Question 2

Special revenue funds are used when it is desirable to provide separate reporting of resources that are assigned to expenditure for purposes other than debt service or capital projects.

Accepted Answer

A) True 
 B)False  False

Question 3

The journal entry to record an encumbrance would include:

Accepted Answer

A)  A debit to Encumbrance Control 
B)  A debit to Budgetary Fund Balance - Reserve for Encumbrances 
C)  A credit to Budgetary Fund Balance - Reserve for Encumbrances 
D)  A and C would both be included in the journal entry 
A)  A debit to Encumbrance Control 
B)  A debit to Budgetary Fund Balance - Reserve for Encumbrances 
C)  A credit to Budgetary Fund Balance - Reserve for Encumbrances 
D)  A and C would both be included in the journal entry D

Question 4

What is the difference between reciprocal interfund activity and nonreciprocal interfund activity?

Accepted Answer

Reciprocal interfund activity is the int

Question 5

The City of Morganville had the following preclosing account balances in its General Fund as of April 30,2014.Debits and credits are not separated; each account had its "normal" balance.Among the expenditures recorded this year is an amount expended on supplies ordered at the end of the previous year.Assume that encumbrances do not lapse and that the City failed to make the journal entry(s)necessary to re-establish the encumbrance in the current year.
Required:
(a)Prepare all entries necessary to close the General Fund of the City of Morganville.
(b)Prepare a Statement of Revenues,Expenditures,and Changes in Fund Balance for the General Fund for the City of Morganville for the Year Ended April 30,2014.End with the ending fund balance.This is the GAAP operating statement.

Accepted Answer

The answer of The City of Morganville had the following...

Question 6

The City of Pine Cove levied property taxes for the fiscal year ended June 30,2014 in the amount of $9,000,000.It is estimated that 2% will not be collected.During the year ended June 30,2014,$8,100,000 in property taxes was collected.It is estimated that $400,000 will be collected during the next 60 days,$365,000 will be collected after 60 days,and $135,000 will not be collected.What is the maximum amount Lonesome Pines can recognize as property tax revenue for the fiscal year ended June 30,2014 in its Governmental Funds Statement of Revenues,Expenditures,and Changes in Fund Balances,assuming there were no unpaid property taxes at the end of the previous year?

Accepted Answer

A)  $9,000,000. 
B)  $8,865,000. 
C)  $8,500,000. 
D)  $8,100,000. 
A)  $9,000,000. 
B)  $8,865,000. 
C)  $8,500,000. 
D)  $8,100,000.

Question 7

Expenditures for claims and judgments,compensated absences,and special termination benefits should be recognized in the General Fund whether or not the liabilities are to be paid with available resources.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following is an interfund transaction?

Accepted Answer

A)  Interfund services provided and used 
B)  Interfund transfers 
C)  Interfund loans 
D)  All of the above are interfund transactons 
A)  Interfund services provided and used 
B)  Interfund transfers 
C)  Interfund loans 
D)  All of the above are interfund transactons

Question 9

Special revenue funds are used when it is desirable to provide separate reporting of resources that are restricted or committed to expenditure for purposes other than debt service or capital projects.

Accepted Answer

A) True 
 B)False

Question 10

Receivables from sales taxes are recorded in the period that the retailer submits the taxes to the government.

Accepted Answer

A) True 
 B)False

Question 11

The following transactions occurred in the General Fund of Smyth County.Prepare the journal entry(s)as instructed for each.Assume each item is independent of each other.
A.The total estimated revenue budget for 2014 is $11,000,000 and the total appropriations for 2014 are $9,500,000.Total planned transfer to debt service funds for 2014 is $800,000.Record the budget (without subsidiary ledger detail)
B.Smyth County was able to get a Tax Anticipation Note that was secured by the county's power to tax.The county borrowed $500,000 and planned to repay the loan as tax collections begin to exceed current disbursements for the year.Upon repayment of the loan the county must pay $12,600 in interest.- Record the Note payable and the later repayment of the note payable
C.Property taxes of $ 7,000,000 were levied for Smyth County.Assume that 1.5 percent of these taxes are estimated to be uncollectible due to local economic conditions.- Record the entry when the tax is levied
D.During 2014 the billing staff inappropriately had duplicate bills for the same properties in the amount of $23,000.Record the entry to correct this error.
E.Upon examining the revenues and expenditures to date,the governing board decided to amend the budget.The revenue budget needs to be decreased by $85,000 and the appropriations should be increased by $65,000.- Record the amendments to the budget when legally approved
F.A review of the Tax Receivable subsidiary ledger indicates the following:
•$20,000 would be received 120 days after year-end
•$45,000 would be received 90 days after year-end
•$22,000 would be received 60 days after year-end
•$21,000 would be received 30 days after year-end
Record the property tax revenue deferred that is required by the GASB
G.The treasurer of Smyth County approved the write-off of delinquent taxes from 2015 totaling $10,200 and related interest and penalties of $750.- Record the write-off of uncollectible delinquent taxes

Accepted Answer

The answer of The following transactions occurred in the General...

Question 12

Interfund transfers occur between individual funds in the same government system without the requirement of repayment.If the General Fund transferred money to the Debt Service Fund,how would the Debt Service Fund account for the transaction?

Accepted Answer

A)  As non-operating revenue. 
B)  As a liability on the balance sheet. 
C)  As a source of funds on the activities statement. 
D)  As a reduction in net liabilities. 
A)  As non-operating revenue. 
B)  As a liability on the balance sheet. 
C)  As a source of funds on the activities statement. 
D)  As a reduction in net liabilities.

Question 13

$60,000 of property tax owed to the city of Akron will not be collected within 60 days after year end.The year end journal entry to record this information would include a:

Accepted Answer

A)  A credit to Revenues Control. 
B)  A debit to Deferred Revenue - Property Taxes. 
C)  A credit to Income Taxes Receivable. 
D)  A debit to Revenues Control. 
A)  A credit to Revenues Control. 
B)  A debit to Deferred Revenue - Property Taxes. 
C)  A credit to Income Taxes Receivable. 
D)  A debit to Revenues Control.

Question 14

Interfund services provided and used are recognized as direct Increases and Decreases in Fund Balance

Accepted Answer

A) True 
 B)False

Question 15

The term special item is defined as:

Accepted Answer

A)  Frequent and unusual but within management's control. 
B)  Unusual or infrequent but within management's control. 
C)  Frequent and unusual and not within management's control. 
D)  Unusual or infrequent and not within management's control. 
A)  Frequent and unusual but within management's control. 
B)  Unusual or infrequent but within management's control. 
C)  Frequent and unusual and not within management's control. 
D)  Unusual or infrequent and not within management's control.

Question 16

Every general purpose government will have a single General Fund.

Accepted Answer

A) True 
 B)False

Question 17

Purchase orders for items ordered by the General Fund totaled $ 205,000.Upon receipt,invoices for these items totaled $200,000.Which of the following will take place on the date the goods are received.

Accepted Answer

A)  An encumbrance is debited for $205,000. 
B)  Budgetary Fund Balance -- Reserve for Encumbrances is credited for $200,000. 
C)  An expenditure is credited for $205,000. 
D)  A liability is credited for $200,000. 
A)  An encumbrance is debited for $205,000. 
B)  Budgetary Fund Balance -- Reserve for Encumbrances is credited for $200,000. 
C)  An expenditure is credited for $205,000. 
D)  A liability is credited for $200,000.

Question 18

In the General Fund,revenues are recognized when earned and available

Accepted Answer

A) True 
 B)False

Question 19

Proceeds from the Sale of Land in the General Fund is a source of funds and would be closed at year end.

Accepted Answer

A) True 
 B)False

Question 20

Which of the following is not likely to be recorded in a special revenue fund?

Accepted Answer

A)  Phone fees restricted to supporting the emergency 911 access system. 
B)  Hotel taxes restricted to promoting tourism. 
C)  Sales taxes restricted to courthouse additions. 
D)  State motor fuel tax restricted to road maintenance. 
A)  Phone fees restricted to supporting the emergency 911 access system. 
B)  Hotel taxes restricted to promoting tourism. 
C)  Sales taxes restricted to courthouse additions. 
D)  State motor fuel tax restricted to road maintenance.

What is the different accounting treatment with respect to supplies inventory using the Consumption versus the Purchases method?

Special revenue funds are used when it is desirable to provide separate reporting of resources that are assigned to expenditure for purposes other than debt service or capital projects.

The journal entry to record an encumbrance would include:

What is the difference between reciprocal interfund activity and nonreciprocal interfund activity?

Expenditures for claims and judgments,compensated absences,and special termination benefits should be recognized in the General Fund whether or not the liabilities are to be paid with available resources.

Which of the following is an interfund transaction?

Special revenue funds are used when it is desirable to provide separate reporting of resources that are restricted or committed to expenditure for purposes other than debt service or capital projects.

Receivables from sales taxes are recorded in the period that the retailer submits the taxes to the government.

Interfund transfers occur between individual funds in the same government system without the requirement of repayment.If the General Fund transferred money to the Debt Service Fund,how would the Debt Service Fund account for the transaction?

$60,000 of property tax owed to the city of Akron will not be collected within 60 days after year end.The year end journal entry to record this information would include a:

Interfund services provided and used are recognized as direct Increases and Decreases in Fund Balance

The term special item is defined as:

Every general purpose government will have a single General Fund.

Purchase orders for items ordered by the General Fund totaled $ 205,000.Upon receipt,invoices for these items totaled $200,000.Which of the following will take place on the date the goods are received.

In the General Fund,revenues are recognized when earned and available

Proceeds from the Sale of Land in the General Fund is a source of funds and would be closed at year end.

Which of the following is not likely to be recorded in a special revenue fund?

Introduction to Accounting and Financial Reporting for Governmental and Not-For-Profit Organizations

Overview of Financial Reporting for State and Local Governments

Modified Accrual Accounting: Including the Role of Fund Balances and Budgetary Authority

Accounting for Other Governmental Fund Types: Capital Projects, Debt Service, and Permanent

Proprietary Funds

Fiduciary Trustfunds

Government-Wide Statements, Capital Assets, Long-Term Debt

Accounting for Special-Purpose Entities, Including Public Colleges and Universities

Accounting for Private Not-For-Profit Organizations

College and University Accounting Private Institutions

Accounting for Hospitals and Other Health Care Providers

Auditing, Tax-Exempt Organizations, and Evaluating Performance

Financial Reporting by the Federal Government

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Exam 4: Accounting for the General and Special Revenue Funds

What is the different accounting treatment with respect to supplies inventory using the Consumption versus the Purchases method?

Special revenue funds are used when it is desirable to provide separate reporting of resources that are assigned to expenditure for purposes other than debt service or capital projects.

The journal entry to record an encumbrance would include:

What is the difference between reciprocal interfund activity and nonreciprocal interfund activity?

Expenditures for claims and judgments,compensated absences,and special termination benefits should be recognized in the General Fund whether or not the liabilities are to be paid with available resources.

Which of the following is an interfund transaction?

Special revenue funds are used when it is desirable to provide separate reporting of resources that are restricted or committed to expenditure for purposes other than debt service or capital projects.

Receivables from sales taxes are recorded in the period that the retailer submits the taxes to the government.

Interfund transfers occur between individual funds in the same government system without the requirement of repayment.If the General Fund transferred money to the Debt Service Fund,how would the Debt Service Fund account for the transaction?

$60,000 of property tax owed to the city of Akron will not be collected within 60 days after year end.The year end journal entry to record this information would include a:

Interfund services provided and used are recognized as direct Increases and Decreases in Fund Balance

The term special item is defined as:

Every general purpose government will have a single General Fund.

Purchase orders for items ordered by the General Fund totaled $ 205,000.Upon receipt,invoices for these items totaled $200,000.Which of the following will take place on the date the goods are received.

In the General Fund,revenues are recognized when earned and available

Proceeds from the Sale of Land in the General Fund is a source of funds and would be closed at year end.

Which of the following is not likely to be recorded in a special revenue fund?

Introduction to Accounting and Financial Reporting for Governmental and Not-For-Profit Organizations

Overview of Financial Reporting for State and Local Governments

Modified Accrual Accounting: Including the Role of Fund Balances and Budgetary Authority

Accounting for Other Governmental Fund Types: Capital Projects, Debt Service, and Permanent

Proprietary Funds

Fiduciary Trustfunds

Government-Wide Statements, Capital Assets, Long-Term Debt

Accounting for Special-Purpose Entities, Including Public Colleges and Universities

Accounting for Private Not-For-Profit Organizations

College and University Accounting Private Institutions

Accounting for Hospitals and Other Health Care Providers

Auditing, Tax-Exempt Organizations, and Evaluating Performance

Financial Reporting by the Federal Government

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