Question 1

Revenue bonds

Accepted Answer

A)  Carry less risk than general obligation bonds 
B)  Are no longer in existence 
C)  Are payable solely from the revenues of an enterprise 
D)  Are backed by the full faith and credit of the government in addition to enterprise revenues 
A)  Carry less risk than general obligation bonds 
B)  Are no longer in existence 
C)  Are payable solely from the revenues of an enterprise 
D)  Are backed by the full faith and credit of the government in addition to enterprise revenues

Question 2

Which of the following is false regarding proprietary fund accounting?.

Accepted Answer

A)  The economic resources measurement focus and accrual accounting are used 
B)  Capital assets are recorded in the accounts and depreciated 
C)  The Statement of Net Assets must be in a classified format, with current assets separated from noncurrent assets and current liabilities separated from noncurrent liabilities 
D)  In the Statement of Net Assets, the net assets are reported as reserved and unreserved 
A)  The economic resources measurement focus and accrual accounting are used 
B)  Capital assets are recorded in the accounts and depreciated 
C)  The Statement of Net Assets must be in a classified format, with current assets separated from noncurrent assets and current liabilities separated from noncurrent liabilities 
D)  In the Statement of Net Assets, the net assets are reported as reserved and unreserved

Question 3

Customer's meter deposits which cannot be spent for normal operating purposes would be classified as restricted cash in the Statement of Net Assets of which fund?

Accepted Answer

A)  Internal Service 
B)  Nonexpendable Trust 
C)  Special Revenue 
D)  Enterprise 
A)  Internal Service 
B)  Nonexpendable Trust 
C)  Special Revenue 
D)  Enterprise

Question 4

Which of the following is true regarding the cash flow statements of a proprietary fund?

Accepted Answer

A)  A reconciliation is required between the Statement of Revenues, Expenses and Changes in Fund Net Assets and the cash flows from operating activities section of the Cash Flow Statement 
B)  Interest receipts are reported as increases in cash flows from either capital and related financing or noncapital financing activities, whichever is appropriate 
C)  The gain from the sale of equipment would be reported in the investing section 
D)  None of the above 
A)  A reconciliation is required between the Statement of Revenues, Expenses and Changes in Fund Net Assets and the cash flows from operating activities section of the Cash Flow Statement 
B)  Interest receipts are reported as increases in cash flows from either capital and related financing or noncapital financing activities, whichever is appropriate 
C)  The gain from the sale of equipment would be reported in the investing section 
D)  None of the above

Question 5

An enterprise fund should be used when debt is back solely by fees and charges

Accepted Answer

A) True 
 B)False

Question 6

An enterprise fund should be used when the government has a policy to establish fees to cover the costs of providing services for an activity.

Accepted Answer

A) True 
 B)False

Question 7

Long term debt serviced from proprietary funds is recorded in the Long Term Debt Account Group.

Accepted Answer

A) True 
 B)False

Question 8

Municipal solid waste landfills, when accounted for as proprietary funds, record a liability for closure and post-closure care costs; recording expenses on a units of production basis.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following funds use business accounting?

Accepted Answer

A)  Internal Service Fund 
B)  Enterprise Fund 
C)  General Fund 
D)  Both A & B 
A)  Internal Service Fund 
B)  Enterprise Fund 
C)  General Fund 
D)  Both A & B

Question 10

Which of the following would be found in an Enterprise Fund Financial Statement?

Accepted Answer

A)  Expenditure - Supplies 
B)  Reserve for Encumbrance 
C)  Appropriations 
D)  Depreciation Expense 
A)  Expenditure - Supplies 
B)  Reserve for Encumbrance 
C)  Appropriations 
D)  Depreciation Expense

Question 11

Under GASB 34, enterprise funds must be used:

Accepted Answer

A)  When debt is backed solely by fees and charges 
B)  When a legal requirement exists that the cost of providing services for activity, including capital costs, be recovered through fees or charges 
C)  When a government has a policy to establish fees and charges to cover the cost of providing services for an activity 
D)  All of the above 
A)  When debt is backed solely by fees and charges 
B)  When a legal requirement exists that the cost of providing services for activity, including capital costs, be recovered through fees or charges 
C)  When a government has a policy to establish fees and charges to cover the cost of providing services for an activity 
D)  All of the above

Question 12

Which of the following is false regarding proprietary funds financial statements?

Accepted Answer

A)  Major enterprise and internal service funds are reported 
B)  Discretely presented component units that are business-type in nature are not reported; those units would be in the government-wide statements only 
C)  A classified approach must be used when preparing the Statement of Net Assets where current assets are displayed separately from long-term assets and current liabilities are displayed separately from long-term liabilities 
D)  With respect to the Statement of Net Assets, the net assets are displayed in the same three categories as in the government-wide statements 
A)  Major enterprise and internal service funds are reported 
B)  Discretely presented component units that are business-type in nature are not reported; those units would be in the government-wide statements only 
C)  A classified approach must be used when preparing the Statement of Net Assets where current assets are displayed separately from long-term assets and current liabilities are displayed separately from long-term liabilities 
D)  With respect to the Statement of Net Assets, the net assets are displayed in the same three categories as in the government-wide statements

Question 13

The General Fund of the City of Parkersburg made a permanent contribution of $100,000 to an internal service fund in 2009. Also, during the year, the internal service fund had revenues of $500,000, expenses of $450,000 and a transfer out of $30,000. Assuming this was the first year of operations for the internal service fund, the ending net assets balance, after closing entries, would be:

Accepted Answer

A)  $120,000 
B)  $100,000 
C)  $ 20,000 
D)  $ 80,000 
A)  $120,000 
B)  $100,000 
C)  $ 20,000 
D)  $ 80,000

Question 14

Internal service funds account for

Accepted Answer

A)  Activities that produce goods or services to be provided to other governmental units on a cost reimbursement basis 
B)  Activities that produce goods or services to be provided to outside consumers units on a cost reimbursement basis 
C)  Both A and B 
D)  None of the above 
A)  Activities that produce goods or services to be provided to other governmental units on a cost reimbursement basis 
B)  Activities that produce goods or services to be provided to outside consumers units on a cost reimbursement basis 
C)  Both A and B 
D)  None of the above

Question 15

Long term debt serviced from proprietary funds are recorded in the proprietary fund.

Accepted Answer

A) True 
 B)False

Question 16

Which of the following are best described as proprietary funds? I. Internal Service funds
II) Pension funds
III) Enterprise funds

Accepted Answer

A)  I only 
B)  I and II 
C)  I and III 
D)  I, II and III 
A)  I only 
B)  I and II 
C)  I and III 
D)  I, II and III

Question 17

Proprietary funds utilize what basis of accounting?

Accepted Answer

A)  Modified accrual 
B)  Accrual 
C)  Cash 
D)  Budgetary 
A)  Modified accrual 
B)  Accrual 
C)  Cash 
D)  Budgetary

Question 18

The two types of proprietary funds include:

Accepted Answer

A)  Enterprise funds and capital projects funds 
B)  Enterprise funds and internal service funds 
C)  Internal service funds and capital project funds 
D)  Agency funds and enterprise funds 
A)  Enterprise funds and capital projects funds 
B)  Enterprise funds and internal service funds 
C)  Internal service funds and capital project funds 
D)  Agency funds and enterprise funds

Question 19

Which of the following statements is true regarding estimated closure costs for municipal solid waste landfills, assuming that it is operating as an enterprise fund?

Accepted Answer

A)  The estimated closure costs are expensed fully at the time of the estimate 
B)  A portion of those future estimated costs be charged as an expense and a liability based on a units-of-production method 
C)  Modified accrual principles apply and the amount expensed is limited to annual anticipated capacity of the landfill 
D)  None of the above is true 
A)  The estimated closure costs are expensed fully at the time of the estimate 
B)  A portion of those future estimated costs be charged as an expense and a liability based on a units-of-production method 
C)  Modified accrual principles apply and the amount expensed is limited to annual anticipated capacity of the landfill 
D)  None of the above is true

Question 20

Internal Service Funds are be used:

Accepted Answer

A)  When debt is backed solely by fees and charges 
B)  When activities that produce goods or services to be provided to other departments or other governmental units on a cost-reimbursement basis 
C)  When a legal requirement exists that the cost of providing services for an activity, including capital costs, be recovered through fees or charges 
D)  When governments account for services provided to general public on a user-charge basis 
A)  When debt is backed solely by fees and charges 
B)  When activities that produce goods or services to be provided to other departments or other governmental units on a cost-reimbursement basis 
C)  When a legal requirement exists that the cost of providing services for an activity, including capital costs, be recovered through fees or charges 
D)  When governments account for services provided to general public on a user-charge basis

Revenue bonds

Which of the following is false regarding proprietary fund accounting?.

Customer's meter deposits which cannot be spent for normal operating purposes would be classified as restricted cash in the Statement of Net Assets of which fund?

Which of the following is true regarding the cash flow statements of a proprietary fund?

An enterprise fund should be used when debt is back solely by fees and charges

An enterprise fund should be used when the government has a policy to establish fees to cover the costs of providing services for an activity.

Long term debt serviced from proprietary funds is recorded in the Long Term Debt Account Group.

Municipal solid waste landfills, when accounted for as proprietary funds, record a liability for closure and post-closure care costs; recording expenses on a units of production basis.

Which of the following funds use business accounting?

Which of the following would be found in an Enterprise Fund Financial Statement?

Under GASB 34, enterprise funds must be used:

Which of the following is false regarding proprietary funds financial statements?

Internal service funds account for

Long term debt serviced from proprietary funds are recorded in the proprietary fund.

Which of the following are best described as proprietary funds? I. Internal Service funds II) Pension funds III) Enterprise funds

Proprietary funds utilize what basis of accounting?

The two types of proprietary funds include:

Which of the following statements is true regarding estimated closure costs for municipal solid waste landfills, assuming that it is operating as an enterprise fund?

Internal Service Funds are be used:

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 the General and Special Revenue Funds

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

Fiduciary Trust Funds

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

Filters

Exam 6: Proprietary Funds

Revenue bonds

Which of the following is false regarding proprietary fund accounting?.

Customer's meter deposits which cannot be spent for normal operating purposes would be classified as restricted cash in the Statement of Net Assets of which fund?

Which of the following is true regarding the cash flow statements of a proprietary fund?

An enterprise fund should be used when debt is back solely by fees and charges

An enterprise fund should be used when the government has a policy to establish fees to cover the costs of providing services for an activity.

Long term debt serviced from proprietary funds is recorded in the Long Term Debt Account Group.

Municipal solid waste landfills, when accounted for as proprietary funds, record a liability for closure and post-closure care costs; recording expenses on a units of production basis.

Which of the following funds use business accounting?

Which of the following would be found in an Enterprise Fund Financial Statement?

Under GASB 34, enterprise funds must be used:

Which of the following is false regarding proprietary funds financial statements?

Internal service funds account for

Long term debt serviced from proprietary funds are recorded in the proprietary fund.

Which of the following are best described as proprietary funds? I. Internal Service funds II) Pension funds III) Enterprise funds

Proprietary funds utilize what basis of accounting?

The two types of proprietary funds include:

Which of the following statements is true regarding estimated closure costs for municipal solid waste landfills, assuming that it is operating as an enterprise fund?

Internal Service Funds are be used:

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 the General and Special Revenue Funds

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

Fiduciary Trust Funds

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

Filters