Question 1

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.

Accepted Answer

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

Question 2

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.

Accepted Answer

The answer of For each of the following events or...

Question 3

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.

Accepted Answer

The answer of The following are transactions for the city...

Question 4

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?

Accepted Answer

A) A temporary fund 
B) A general fund 
C) An agency fund 
D) An enterprise fund

Question 5

Governmental accounting differs from corporate financial accounting primarily because

Accepted Answer

A) the size of the government and the various levels would make it unreasonable to use corporate GAAP. 
B) governments lack a profit motive and must focus on accountability to the public they serve. 
C) the government has no stakeholders who require financial reporting. 
D) the government has too many types of organizations to use one type of corporate GAAP.

Question 6

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

Accepted Answer

A) When a homeowner pays property taxes 
B) When a university receives a federal grant that mandates a certain type of research activity 
C) When an aquatic center receives cash for a group swim 
D) When an employer deducts money for state tax withholding

Question 7

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

Accepted Answer

A) when the relevant service is done. 
B) when they are collected. 
C) when the paying entity is billed. 
D) when they become both measurable and available.

Question 8

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.

Accepted Answer

The answer of The following are transactions for the city...

Question 9

The key focus of government fund accounting concerns

Accepted Answer

A) capital expenditures. 
B) intergovernmental transfers from the general fund. 
C) income measurement. 
D) the current ability to provide and fund services and goods.

Question 10

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
.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
.Expenditures

Accepted Answer

The answer of Match the following definitions to the appropriate...

Question 11

Which fund would most likely report depreciation expense?

Accepted Answer

A) A special revenue fund 
B) An enterprise fund 
C) A capital projects fund 
D) A debt service fund

Question 12

Government-wide financial statements include a

Accepted Answer

A) balance sheet,an income statement,and a statement of cash flows. 
B) statement of net assets,a statement of activities,and a statement of cash flows. 
C) statement of net assets and a statement of activities. 
D) statement of activities and a statement of cash flows.

Question 13

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

Accepted Answer

A) Financial Accounting Standards Board Statements 
B) GASB Statements 
C) Consensus Positions of GASB Emerging Issues Task Force 
D) GASB Technical Bulletins

Question 14

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.

Accepted Answer

The answer of The following are transactions for the city...

Question 15

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.

Accepted Answer

The answer of The following are transactions for the city...

Question 16

The modified accrual basis of accounting is used for

Accepted Answer

A) governmental funds. 
B) proprietary funds. 
C) internal service funds. 
D) both A and C.

Question 17

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

Accepted Answer

A) modified accrual;modified accrual 
B) accrual;fund 
C) modified accrual;accrual 
D) blended;discrete

Question 18

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.

Accepted Answer

The answer of The following are transactions for the city...

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.

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 key focus of government fund accounting concerns

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 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.