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

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.

"The primary purpose of an accounting system for a state or a local government is to make it possible for financial statements to demonstrate compliance with finance-related legal and contractual provisions." Explain why you believe this statement to be correct or incorrect.

Explain the nature of the three major activity categories of a state or local government: governmental activities,business-type activities,and fiduciary activities.Provide examples of each.

Economic resources are cash or items expected to be converted into cash during the current period,or soon enough thereafter to pay current period liabilities.

Which of the following is a proprietary fund?

"Generally accepted accounting principles include both those principles established by the Governmental Accounting Standards Board and those required by state laws." Indicate whether this statement is true or false and explain why.

According to GASB standards transfers should be recognized

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

Which of the following is a fiduciary fund?

Capital assets used by departments accounted for by the General Fund of a governmental unit should be accounted for in

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

Which of the following funds are governmental funds?

The measurement focus and basis of accounting that are most unlike those used by business entities are those used by

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?

Describe the basic financial statements required by GASB standards and briefly explain their purposes.

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

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

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?

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

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