Question 1

The general fund of the Town of Dean levied property taxes of $3,000,000 for the fiscal year beginning on January 1,20X8.It was estimated that 1% of the levy would be uncollectible.During the period January 1,20X8,through December 31,20X8,$2,960,000 of the property tax levy was collected.At December 31,20X8,Dean estimated that $10,000 of property taxes levied in 20X8 would be collected during the first 60 days of 20X9.What amount of property tax revenue should be reported by the general fund for the year ended December 31,20X8?

Accepted Answer

A)  $2,960,000 
B)  $3,000,000 
C)  $2,970,000 
D)  $2,990,000

Question 2

The City of Ames uses the consumption method to report its inventory of supplies on its general fund balance sheet.What account is debited in the general fund when Ames acquires supplies?

Accepted Answer

A)  Expenditures 
B)  Inventory of Supplies 
C)  Supplies Expense 
D)  Fund Balance-Nonspendable

Question 3

Which of the following statements is (are)correct about the funds used by governmental entities?

Accepted Answer

A)  I only 
B)  II only 
C)  I and II 
D)  Neither I nor II

Question 4

The general fund of the City of Columbia transferred money to establish an internal service fund for the city's data processing needs.The general fund of Columbia should account for this transaction as a(n):

Accepted Answer

A)  expenditure. 
B)  interfund transfer. 
C)  interfund reimbursement. 
D)  loan.

Question 5

GASB 34 established four types of interfund activities.Interfund activities are recognized as revenue in a governmental fund for an:

Accepted Answer

The answer of GASB 34 established four types of interfund...

Question 6

Which of the following funds should use the accrual basis of accounting?

Accepted Answer

A)  Enterprise and private-purpose trust funds. 
B)  Permanent funds and internal service funds. 
C)  Debt service and agency funds. 
D)  Special revenue and capital projects funds.

Question 7

The following related entries were recorded in sequence in the general fund of a municipality:

The sequence of entries indicates that

Accepted Answer

A)  Encumbrances were anticipated but later failed to materialize and were reversed. A liability of $12,350 was incurred. 
B)  An adverse event was foreseen and a reserve of $12,000 was created; later the reserve was cancelled and a liability for the item was acknowledged. 
C)  An order was placed for goods or services estimated to cost $12,000; the actual cost was $12,350 for which a liability was acknowledged upon receipt. 
D)  The first entry was erroneous and was reversed; a liability of $12,350 was acknowledged.

Question 8

Which of the following observations concerning interfund transfers is true?

Accepted Answer

A)  They are expected to be repaid. 
B)  They are classified as fund revenues or expenditures. 
C)  The receiving fund recognizes these transfers as revenue. 
D)  These transfers are classified under "Other Financing Sources or Uses."

Question 9

The Town of Pasco has no supplies inventory in its general fund on January 1,20X8.During 20X8,Pasco incurred expenditures of $200,000 for the acquisition of supplies.On December 31,20X8,Pasco's inventory of supplies amounted to $30,000.Assume Pasco uses the purchase method of accounting for supplies in its general fund and that the village reports on the calendar year.On December 31,20X8,the general fund of Pasco should credit:

Accepted Answer

A)  Expenditures for $170,000. 
B)  Fund Balance-Unassigned for $170,000. 
C)  Fund Balance-Nonspendable for $30,000. 
D)  Expenditures for $30,000.

Question 10

Which of the following funds provides goods and services only to other departments or agencies of the government on a cost-reimbursement basis?

Accepted Answer

A)  Internal service funds 
B)  Enterprise funds 
C)  Special revenue funds 
D)  The general fund

Question 11

Works of art and historical treasures purchased by the general fund should be reported as:

Accepted Answer

A)  I only. 
B)  II only. 
C)  Both I and II 
D)  Neither I nor II.

Question 12

Accounting processes differ between a for-profit entity and a governmental entity.Discuss three differences between a governmental entity and a for-profit entity.

Accepted Answer

The answer of Accounting processes differ between a for-profit entity...

Question 13

Which of the following describes how a governmental fund (e.g.general fund)accounts for a capital lease?

Accepted Answer

A)  noncurrent liability 
B)  bond accounting 
C)  an asset and a lease liability 
D)  none of the above identifies the appropriate way to account for a capital lease.

Question 14

Which of the following funds should use the modified accrual basis of accounting?

Accepted Answer

A)  Private-purpose trust and agency funds. 
B)  Capital projects and special revenue funds. 
C)  Internal service and enterprise funds. 
D)  Debt service and private-purpose trust funds.

Question 15

Goshen City acquires $36,000 of inventory on November 1, 20X5, having held no inventory previously. On December 31, 20X5, the end of Goshen City's fiscal year, a physical count shows $7,000 still in stock. During 20X6, $5,000 of this inventory is used, resulting in a $2,000 remaining balance of supplies on December 31, 20X6.
-Based on the preceding information,which of the following would be the correct account balances for 20X6 if Goshen City used the consumption method of accounting for inventories?

Accepted Answer

The answer of Goshen City acquires $36,000 of inventory on...

Question 16

The adjusted trial balance for White River for the fiscal year ended June 30,20X9,is presented below.
  
Required:
a.Prepare a statement of revenues,expenditures,and changed in fund balance for White River for the year ended June 30,20X9.Assume there were no supplies or outstanding encumbrances at the beginning of the year.
b.Prepare a balance sheet for White River at June 30,20X9.
Problem 84 (continued):

Accepted Answer

The answer of The adjusted trial balance for White River...

Question 17

Identify the legal term that allows the general fund to make expenditures.

Accepted Answer

A)  Exceptions 
B)  Appropriations 
C)  Encumbrances 
D)  Consumption

Question 18

Which of the following funds are classified as proprietary funds?

Accepted Answer

A)  Agency and special revenue funds. 
B)  Enterprise and internal service funds. 
C)  Debt service and capital projects funds. 
D)  Agency and pension trust funds.

Question 19

Under the modified accrual basis of accounting,revenue should be recognized when it is:

Accepted Answer

A)  measurable and earned. 
B)  received in cash. 
C)  available and earned. 
D)  measurable and available.

Question 20

Goshen City acquires $36,000 of inventory on November 1, 20X5, having held no inventory previously. On December 31, 20X5, the end of Goshen City's fiscal year, a physical count shows $7,000 still in stock. During 20X6, $5,000 of this inventory is used, resulting in a $2,000 remaining balance of supplies on December 31, 20X6.
-Based on the preceding information,which of the following would be the correct account balances for 20X6 if Goshen City used the purchase method of accounting for inventories?

Accepted Answer