Question 1

A certain government passed its budget for the fiscal year ended December 31, 2017. Estimated Revenues amounted to $13,000,000; Appropriations amounted to
$12,000,000; Estimated Other Financing Uses amounted to $700,000; and Estimated Other Financing Sources amounted to $200,000. In the budgetary entry combining entry:

Accepted Answer

A)  Budgetary Fund Balance would be credited for $500,000. 
B)  Budgetary Fund Balance would be debited for $500,000. 
C)  Budgetary Fund Balance would be debited for $1,000,000. 
D)  Budgetary Fund Balance would be credited for $1,500,000.

Question 2

An exchange transaction is one where each party is given and receives essentially equal value.

Accepted Answer

A) True 
 B)False

Question 3

The Budgetary Comparison Schedule is considered a part of Required Supplementary Information in the Comprehensive Annual Financial Report.

Accepted Answer

A) True 
 B)False

Question 4

At year-end, the balance of Expenditures, Revenues and Other Financing Sources and Uses accounts are closed to:

Accepted Answer

A)  Budgetary Fund Balance 
B)  Expenses 
C)  Fund Balance 
D)  Expenditure Control

Question 5

What would be the total Nonspendable fund balance?

Accepted Answer

A)  $ 69,000 
B)  $ 71,500 
C)  $190,000 
D)  $410,000

Question 6

Budgets are legally binding upon administrators.

Accepted Answer

A) True 
 B)False

Question 7

When a computer which is to be used by an activity accounted for by the General Fund of a governmental unit is received, it should be recorded in the General Fund as aan:

Accepted Answer

A)  Encumbrance. 
B)  Appropriation. 
C)  Expenditure. 
D)  Capital asset.

Question 8

According to GASB, which of the following statements is correct regarding committed funds?

Accepted Answer

A)  Committed funds are those that are designated as committed through ordinance or resolution by the government's highest level of authority. 
B)  These constraints are easily changed by administrators. 
C)  This is constraint is imposed by law and may not be changed without amendment of the law. 
D)  Committed funds may be redesignated to uncommitted in the event of a budget shortfall.

Question 9

In a budgetary entry combining entry, if Estimated Revenues Control exceeds Appropriations Control, the excess would be:

Accepted Answer

A)  credited to Fund Balance-Unreserved. 
B)  debited to Fund Balance-Unreserved. 
C)  debited to Budgetary Fund Balance. 
D)  credited to Budgetary Fund Balance.

Question 10

What are the revenue and expenditure recognition criteria under modified accrual accounting? Include in your answer specifically the recognition of property tax revenue.

Accepted Answer

The answer of What are the revenue and expenditure recognition...

Question 11

List the four eligibility requirements for a government to record revenue from a nonexchange transaction. Provide a brief explanation for each.

Accepted Answer

The answer of List the four eligibility requirements for a...

Question 12

A Fair Exchange transaction is one in which a government gives or receives value without directly receiving or giving equal value in exchange.

Accepted Answer

A) True 
 B)False

Question 13

Expenditure classification by character includes current, capital outlay, and debt service.

Accepted Answer

A) True 
 B)False

Question 14

What would be the total Restricted fund balance?

Accepted Answer

A)  $190,000 
B)  $410,000 
C)  $479,000 
D)  $ 49,000

Question 15

When a liability is incurred as authorized by an appropriation, the appropriation is said to be:

Accepted Answer

A)  Encumbered 
B)  Appropriated 
C)  Expensed 
D)  Expended

Question 16

Under modified accrual accounting, budgetary authority expires at year end and the balances of Revenues and Expenditures are closed to

Accepted Answer

A)  Net Position 
B)  Fund Balance 
C)  Other Financing Uses 
D)  Other Financing Sources

Question 17

A nonexchange transaction is one where a government receives resources without giving equal value in return.

Accepted Answer

A) True 
 B)False

Question 18

A transaction in which a government receives resources without directly giving equal value in exchange is known as an:

Accepted Answer

A)  Equity Transaction. 
B)  Fair Exchange. 
C)  Non-exchange Transaction. 
D)  Not Fair Market Exchange transaction.

Question 19

Which of the following statements is true?

Accepted Answer

A)  The modified accrual basis is a distinct system of accounting that contains financial statement elements that appear nowhere else. Among these are expenditures and fund balances. 
B)  The modified accrual accounting used in governmental accounting is essentially equivalent to the cash basis accounting used by businesses. 
C)  Governmental funds record may not record liabilities or accrue expenditures when payable. 
D)  Revenues are recorded the same under accrual and modified accrual accounting. The difference in the two methods applies only to expenses/expenditures.

Question 20

The Police Department of a given city received an appropriation in the amount of $9,000,000 for the fiscal year ended June 30, 2017. During the month ended July 31, 2017, the following transactions occurred: a) purchase orders were issued in the amount of $800,000; b) purchase orders, related to a) above, were filled in the amount of $790,000; the related invoice amount was $795,000; invoices were paid in the amount of $750,000; c) salaries were accrued and paid in the amount of $775,000. The balance available for the police department as of July 31, 2017 is:

Accepted Answer

A)  $7,420,000. 
B)  $7,430,000. 
C)  $7,460,000. 
D)  $7,425,000.

Exam 3: Modified Accrual Accounting: Including the Role of Fund Balances and Budgetary Authority

An exchange transaction is one where each party is given and receives essentially equal value.

The Budgetary Comparison Schedule is considered a part of Required Supplementary Information in the Comprehensive Annual Financial Report.

At year-end, the balance of Expenditures, Revenues and Other Financing Sources and Uses accounts are closed to:

What would be the total Nonspendable fund balance?

Budgets are legally binding upon administrators.

When a computer which is to be used by an activity accounted for by the General Fund of a governmental unit is received, it should be recorded in the General Fund as aan:

According to GASB, which of the following statements is correct regarding committed funds?

In a budgetary entry combining entry, if Estimated Revenues Control exceeds Appropriations Control, the excess would be:

What are the revenue and expenditure recognition criteria under modified accrual accounting? Include in your answer specifically the recognition of property tax revenue.

List the four eligibility requirements for a government to record revenue from a nonexchange transaction. Provide a brief explanation for each.

A Fair Exchange transaction is one in which a government gives or receives value without directly receiving or giving equal value in exchange.

Expenditure classification by character includes current, capital outlay, and debt service.

What would be the total Restricted fund balance?

When a liability is incurred as authorized by an appropriation, the appropriation is said to be:

Under modified accrual accounting, budgetary authority expires at year end and the balances of Revenues and Expenditures are closed to

A nonexchange transaction is one where a government receives resources without giving equal value in return.

A transaction in which a government receives resources without directly giving equal value in exchange is known as an:

Which of the following statements is true?