Exam 4: Accounting for the General and Special Revenue Funds

The initial transfer of cash from the General Fund to establish a motor pool internal service fund would require the General Fund to credit Cash and debit:

Only the General Fund may have a positive Unassigned Fund Balance

When payrolls and other liabilities are incurred and must be paid before substantial amounts of cash will be collected, what type of short-term note is desirable and secured by a government's power to tax?

Which of the following accounts of a governmental unit's General fund is debited when supplies previously ordered are received?

Interfund services purchased by the General Fund are recognized as:

When the materials and supplies are received and the invoice is more than the related purchase order, this entry should be made:

Transactions between funds of the same government are not assumed to be arm's length in nature.

The term special item is defined as:

A transfer should be reported in the operating statement of the General Fund as aan):

Governmental fund financial statements are prepared using the accrual basis of accounting.

When establishing funds, governments should attempt to have a large number of special revenue and other funds to provide the user with maximum detail to understand the transactions.

A local government was awarded a federal grant in the amount of $800,000 to provide for a summer youth employment program for young people. The grant was a reimbursement grant, and a notification of the grant award was received on Apri1 30, 2017. The local government expended the resources as follows: June 2017: $250,000 July 2017: $285,000 August 2017: $265,000 The federal government sent the funds in the month following the expenditure. The local government would recognize revenues for the fiscal year ended June 30, 2017 in which amount?

When accounting for the General Fund, the Encumbrances Control account is credited when:

What would be the effect on the General Fund's Fund Balance at the end of the current fiscal year of recording the purchase of a $5,000 new computer with a five year estimated useful life and zero salvage?

Governmental fund financial statements are to be prepared on the

The purpose of fund accounting is to segregate those financial resources that have constraints or limitations on their use so that the government may demonstrate compliance with those limitations.

With respect to reimbursement grant accounting, which of the following statements is true?

The City of Morganville had the following pre-closing account balances in its General Fund as of April 30, 2017. 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 entrys) 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, 2017. End with the ending fund balance. This is the GAAP operating statement. Cash \ 75,000 Estimated Revenues Control 5,900,000 Revenues Control 5,900,000 Appropriations Control 5,750,000 Estimated Other Financing Sources Control 250,000 Other Financing Uses Control-Transfers Out 375,000 Expenditures Control 5,275,000 Taxes Receivable 785,000 Fund Balance-Unassigned 5/1/2016 610,000 Estimated Other Financing Uses Control 500,000 Vouchers Payable 135,000 Encumbrances Control 29,000 Budgetary Fund Balance -- Reserve for Encumbrances 29,000 Other Financing Sources Control-Transfers In 135,000 Budgetary Fund Balance debit) 100,000

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.

Which of the following is false with respect to Special revenue funds?