Exam 19: An Introduction to Accounting for State and Local Governmental Units

Because a fund is an accounting entity,each fund has I.its own accounting equation. II)its own journals,ledgers,and other accounting records. III)its own separate auditor.

For each of the following events or transactions,identify the fund or funds that will be affected. 1.A city government charges a fee for the use of the municipal golf course. 2.Interest is paid on state government revenue bonds. 3.A motor pool was established to handle the vehicle needs of a county government. 4.Paid salaries for general governmental employees. 5.Accrued salaries for general governmental employees.

The following are transactions for the city of Springfield. a.Borrowed $20,000 by issuing a three-month,5% note. b.Paid $4,000 for equipment. c.Services for $1,000 were billed and collected. d.Year-end accrual of 3 months interest on note in (a). Required: Analyze the above transactions by using the accounting equation for a proprietary fund.

Which type of fund is used to account for a government activity that sells goods or services either solely or almost solely to external customers?

Governmental accounting differs from corporate financial accounting primarily because

When examining revenue transactions,which of the following transactions is classified as an exchange transaction?

Under the modified accrual basis of accounting,revenues are recognized in the period

The following are transactions for the city of Clinton. a.Borrowed $100,000 by issuing a one-year,5% note,three months before year-end. b.Accrued interest at year end,but did not pay the interest at year end. c.Charges for services rendered of $2,500 were billed and collected immediately. d.Incurred salary costs of $5,000,unpaid. Required: Analyze the above transactions by using the accounting equation for a proprietary fund.

The key focus of government fund accounting concerns

Match the following definitions to the appropriate government accounting terms (numbered below). A.Legally separate organization for which primary government is financially accountable B.The use of governmental fund working capital C.Appropriation for a specific time period D.Governmental and Proprietary fund revenues and expenses presented using full accrual accounting E.Approved or authorized expenditures F.Revenues recognized when available to meet current obligations G.Self-balancing set of accounts H.Each state government and each general-purpose local government I.The responsibility to demonstrate compliance with public decisions with regard to the use of financial resources J.Governmental and Internal Service Funds assets and liabilities presented together _____1.Modified Accrual Basis _____2.Fund _____3.Primary Government _____4.Appropriation _____5.Statement of Net Assets _____6.Fiscal Accountability _____7.Allotment _____8.Component Unit _____9.Statement of Activities _____10.Expenditures

Which fund would most likely report depreciation expense?

Government-wide financial statements include a

Which pronouncements have the highest level of authority for state and local governments?

The following are transactions for the city of Franklin. a.Borrowed $20,000 by issuing a two-year note. b.Purchased equipment for $6,000 cash. c.Licenses for $700 were billed on account. d.Accrued employee salary costs of $7,000. e.Depreciation expense on equipment for year,$1,000. Required: Analyze the above transactions by using the accounting equation for a governmental fund.

The following are transactions for the city of Clinton. a.Borrowed $100,000 by issuing a one-year,5% note,three months before year-end. b.Accrued interest at year end,but did not pay the interest at year end. c.Charges for services rendered of $2,500 were billed and collected immediately. d.Incurred salary costs of $5,000,unpaid. Required: Analyze the above transactions by using the accounting equation for a governmental fund.

The modified accrual basis of accounting is used for

Governmental fund financial statements are prepared on the ________ basis of accounting.Proprietary fund financial statements are prepared on the ________ basis of accounting.

The following are transactions for the city of Franklin. a.Borrowed $20,000 by issuing a two-year note. b.Purchased equipment for $6,000 cash. c.Licenses for $700 were billed on account. d.Accrued employee salary costs of $7,000. e.Depreciation expense on equipment for year,$1,000. Required: Analyze the above transactions by using the accounting equation for a proprietary fund.