Exam 12: Accounting for State and Local Governments Part 2

Which of the following is a section of the general purpose external financial statements of a state or local government? (1)Management's discussion and analysis (MD&A). (2)Required supplementary information (other than MD&A). (3) )Basic financial statements and notes to financial statements.

What information is required in the financial section of a state or local government's CAFR?

Jones College,a public institution of higher education,must prepare financial statements

A local government's basic financial statements would include a statement of cash flows for all

What information is required in the introductory section of a state or local government's CAFR?

How is the Statement of Cash Flows for Proprietary Funds similar and dissimilar to a Statement of Cash Flows for a for-profit business?

For fund-based financial statements,what account is credited when a piece of equipment is leased on a capital lease?

A city starts a solid waste landfill during 2010.When the landfill was opened the city estimated that it would fill to capacity within 5 years and that the cost to cover the facility would be $1.5 million which will not be paid until the facility is closed.At the end of 2010,the facility was 20% full,and at the end of 2011 the facility was 45% full.If the landfill is judged to be a governmental fund,what liability is reported on the fund-based financial statements at the end of 2011?

What is meant by the term legally independent?

The employees of the City of Raymond earn vacation compensation that totals $1,500 per week.During 2011,$30,000 in vacation time was taken and the remainder is expected to be used during the latter part of next year.In the government-wide financial statements,assuming there was no beginning balance,what liability should be reported at the end of 2011?

What are the three broad sections of a state or local government's CAFR?

The City of Wetteville has a fiscal year ending June 30.Examine the following transactions for Wetteville: (A. )On 6/1/11,Wetteville enters into a 5-year lease on a copying machine.The lease meets the criteria of a capital lease and carries an implied interest rate of 10%.The copier has a present value of $2,300.Wetteville has to put a $300 down payment on the lease at the beginning of the lease with monthly payments thereafter of $42.49. (B. )On 6/5/11,Wetteville opens a new landfill.The engineers estimate that at the end of 10 years the landfill will be full.Estimated costs to close the landfill are currently at $3,500,000. (C. )On 6/15/11,the end of the two-week pay period,Wetteville has $20,000 in accrued vacation pay related to the payroll for the period.The city estimates that $5,000 of this pay will be taken by the end of this summer and the rest will be used next summer. (D. )On 6/18/11,Wetteville receives a donation of a vintage railroad steam engine.The engine will be put on display at the local town park.A fee will be charged to actually climb up into the engine.The engine has been valued at $500,000. (E. )On 6/30/11,Wetteville makes its first payment on the leased copier.The $42.49 payment includes $16.68 interest. (F. )On 6/30/11,Wetteville estimates that the landfill is 2% filled. Required: Prepare the journal entries for the above transactions,on the dates mentioned for each lettered item,for the purposes of preparing the government-wide financial statements.

GASB No.34 makes which of the following statements regarding Management's Discussion and Analysis?

The parking garage and parking lots owned by the city of Danton reported the following balances for 2011: Receipts from public users of the parking facilities \ 190,000 Receipts from the city for parking of city-owned vehicles 8,000 Salaries paid to employees 75,000 Printing - paid to an internal service fund 6,000 Interest on bonded indebtedness 10,000 Sculpture for entrance to parking lot (donated during 2011) 12,500 Depreciation on parking garage 30,000 Truck (purchased during 2011) 35,000 Maintenance - paid to an internal service fund 17,000 Required: What amount of net revenue (or expense)should be reported by the fund that was used to account for parking operations assuming the preparation of government-wide financial statements?

Marie Todd works for the City of Rochester and volunteered to work the New Years Eve holiday in December,2010.In exchange for working the holiday,the city will grant her 2 vacation days compensated at $500 per day.Marie decided to take these vacation days during January,2011. For Government-wide financial statements,what are the journal entries to record these events in 2010 and in 2011?

The Town of Portsmouth has at the beginning of the year a $213,000 Net Asset balance,and a $52,000 Fund Balance. The following information relates to the activities within the town of Portsmouth for the year of 2011. -Prepare a Statement of Revenues,Expenditures and Changes in Fund Balances

Which of the following must be presented in the MD&A of a government?

For the purpose of government-wide financial statements,the cost of cleaning up a government-owned landfill and closing the landfill

The Town of Portsmouth has at the beginning of the year a $213,000 Net Asset balance,and a $52,000 Fund Balance. The following information relates to the activities within the town of Portsmouth for the year of 2011. -Prepare a Statement of Activities

The town of Wakefield opened a solid waste landfill in 2010 that was at 20% capacity on December 31,2010 and at 50% capacity on December 31,2011.The city initially anticipated closure costs of $2.3 million but in 2011 revised the estimate of the closure costs to be $2.7 million.None of these costs will be incurred until the landfill is scheduled to be closed. Assuming the landfill is recorded within the General fund,what is the journal entry that should be recorded in the Fundbased Financial Statements on December 31,2011?