Deck 10: State and Local Governments: Introduction and General Fund Transactions

Question 1

Major attributes of a government include all of the following except:

A) A government must adhere to a legal budget.
B) Use of certain financial inflows is restricted by external organizations.
C) Matching of revenues to the costs of providing services is a key reporting concept.
D) Governments do not have equity owners.

Answer 1

Matching of revenues to the costs of providing services is a key reporting concept.

Question 2

Which group is most likely to be a user of a county's financial statements?

A) Stockholders
B) Internal Revenue Service
C) Citizens
D) Credit market representatives

Answer 2

Credit market representatives

Question 3

County activities involving economic assistance, health and safety, education, and legislative services are categorized as:

A) Governmental activities
B) Business activities
C) Fiduciary activities
D) Proprietary activities

Answer 3

Governmental activities

Question 4

Activities where a county holds resources in a trust or custodial capacity for entities or individuals outside the county are categorized as:

A) Governmental activities
B) Business activities
C) Fiduciary activities
D) Proprietary activities

Question 5

County activities involving provision of services in return for user fees are categorized as:

A) Governmental activities
B) Business activities
C) Fiduciary activities
D) Proprietary activities

Question 6

Organizations that rate a government's bond issues are least interested in

A) The government's future financing plans.
B) The impact of the government's current performance on future tax rates.
C) Material departures from GAAP in the government's financial statements.
D) Whether the government's financial statements are audited on a timely basis.

Question 7

Category A in the GAAP hierarchy in state and local government accounting consists of

A) GASB Statements
B) GASB Statements and AICPA Industry Audit and Accounting Guides
C) AICPA Industry Audit and Accounting Guides
D) GASB Implementation Guides

Question 8

Which statement below best describes the GAAP hierarchy in state and local government accounting?

A) Only GASB Statements are considered authoritative.
B) GASB Statements and AICPA Industry Audit and Accounting Guides are considered authoritative.
C) Only AICPA Industry Audit and Accounting Guides are considered authoritative.
D) GASB Statements, GASB Technical Bulletins, Implementation Guides, and GASB-approved AICPA literature are considered authoritative.

Question 9

The GAAP hierarchy in state and local government accounting identifies sources of authoritative guidance for:

A) Preparation of a legal budget
B) Preparation of financial statements
C) Providing information required by creditors of the governmental unit
D) Providing information required by supervisory levels of government

Question 10

A government's financial statements report on the activities of

A) The primary government.
B) The primary government and blended component units.
C) The primary government and discretely presented component units.
D) The primary government and all component units.

Question 11

In the financial statements of a county government, a component unit is a government unit:

A) That is geographically located in the county.
B) For which the primary government is financially accountable.
C) That has the same board members as the primary government.
D) That issues its own bonds.

Question 12

A blended component unit of a county is most likely to:

A) Adopt its own budget.
B) Exist to provide services to the primary government.
C) Issue bonds for which the component unit is financially obligated.
D) Have a minority of board members that are employed by the primary government.

Question 13

A discretely presented component unit of a county is most likely to:

A) Require primary government approval for major decisions.
B) Exist to provide services to the primary government.
C) Issue bonds for which the component unit is financially obligated.
D) Have the same governing body as the primary government.

Question 14

Which of the following would most likely be reported as a blended component unit of a county government?

A) The sewer district is responsible for sewage treatment services provided to several surrounding local governments, including the county. The county appoints a minority of the sewer district's board members. The district sets service rates and makes all decisions regarding its operations. Its operations are funded by property tax levies and user charges, and by debt for which it is legally liable.
B) The county library was established by the county and is a separate legal entity receiving an annual budgetary contribution from the county. Library board members are appointed by the county, and bonds and notes for library capital costs are county debt.
C) The county medical center is a separate legal corporation. Its bonds are guaranteed by the county.
D) The building authority is a separate legal entity whose board is appointed by the county. The county is legally liable for bonds issued by the building authority, which are used to finance county construction projects.

Question 15

Activities of a county hospital that is organized as a not-for-profit are likely to be reported

A) In its own financial statements, separate from the county's financial statements.
B) As an NFP organization, following FASB reporting principles.
C) As a discretely presented component unit in the county's financial statements.
D) As a blended component unit in the county's financial statements.

Question 16

Accumulation of money to be used to pay the interest on general obligation bonds is reported in a:

A) Special revenue fund.
B) Custodial fund.
C) Permanent fund.
D) Debt service fund.

Question 17

Legal trusts are reported:

A) Only in fiduciary funds.
B) In governmental funds if they benefit the public.
C) In enterprise funds if they benefit the public and in fiduciary funds if they benefit specific people.
D) In fiduciary funds if they benefit the public and in governmental funds if they benefit specific people.

Question 18

Fiduciary funds of a state or local government include all of the following except:

A) Private purpose trust funds.
B) Custodial funds.
C) Permanent funds.
D) Investment trust funds.

Question 19

Collections of property taxes are reported in a county's:

A) Special revenue fund.
B) General fund.
C) Investment trust fund.
D) Custodial fund.

Question 20

A county is in the process of building a new courthouse. Proceeds of a general obligation bond issue to fund construction are reported in:

A) An enterprise fund.
B) An internal service fund.
C) A debt service fund.
D) A capital projects fund.

Question 21

A county receives a federal grant to be used for community health programs. This grant is reported in

A) An enterprise fund.
B) A special revenue fund.
C) A permanent fund.
D) A custodial fund.

Question 22

A purchase of equipment would be reported as an expenditure in which of the following funds?

A) Enterprise fund
B) Capital projects fund
C) Internal service fund
D) Investment trust fund

Question 23

A purchase of equipment would be reported as an asset in which of the following funds?

A) Enterprise fund
B) Capital projects fund
C) Special revenue fund
D) Permanent fund

Question 24

A government always has only one

A) Enterprise fund.
B) Capital projects fund.
C) Special revenue fund.
D) General fund.

Question 25

Which fund reports its operating results in a statement of revenues, expenditures, and changes in fund balances?

A) Investment trust fund
B) Custodial fund
C) Internal service fund
D) Debt service fund

Question 26

Which fund reports its operating results in a statement of revenues, expenses, and changes in net position?

A) General fund
B) Special revenue fund
C) Internal service fund
D) Debt service fund

Question 27

The governmental funds balance sheet will never report:

A) Long-term bonds payable
B) Property taxes receivable
C) Accounts payable
D) Restricted fund balance

Question 28

The governmental funds operating statement reports:

A) Cash.
B) Expenditures for equipment.
C) Depreciation expense.
D) Loans to other funds.

Question 29

The proprietary funds operating statement reports:

A) Expenditures for capital assets.
B) Accrued interest revenue.
C) Proceeds from sale of property.
D) Payments of principal on long-term debt.

Question 30

The proprietary funds balance sheet reports:

A) Unassigned fund balance.
B) Budgeted expenditures.
C) Net position.
D) Proceeds from sale of property.

Question 31

The financial statements of a general fund include:

A) A statement of revenues, expenses, and changes in net position.
B) A statement of cash flows.
C) A statement of changes in net position.
D) A statement of revenues, expenditures, and changes in fund balances.

Question 32

A county's operating statement for governmental funds will not include

A) Principal payments on long-term debt.
B) Repayment of short-term loans from other funds.
C) Purchases of equipment.
D) Proceeds from the sale of equipment.

Question 33

Which item below would be reported in the "other financing sources and uses" section of the operating statement of the general fund?

A) Capital outlay
B) Transfers to other funds
C) Payment of principal on bonds
D) Payment of interest on bonds

Question 34

Which one of the following is an expenditure of the current year for a general fund?

A) Short-term investments made in the current year.
B) Purchase in the current year of equipment with an estimated life of 20 years
C) Estimated bad debts for the current year
D) Pension benefits earned by current employees.

Question 35

Which one of the following items is reported as a deferred inflow on the general fund's balance sheet?

A) Short-term loan payable to a proprietary fund.
B) Interest owing on bonds, to be paid in three years.
C) Property taxes collected in advance of the year they are available to spend.
D) Long-term investments.

Question 36

Resources from federal grants required to be spent on specific activities are reported in which fund balance category of a county's general fund balance sheet?

A) Assigned
B) Committed
C) Restricted
D) Nonspendable

Question 37

Resources required by the legal budget to be used for debt service are reported in which fund balance category of a state's general fund balance sheet?

A) Assigned
B) Committed
C) Restricted
D) Nonspendable

Question 38

Classifications of fund balance on the general fund balance sheet include all but which one of the classifications below?

A) Nonspendable
B) Committed
C) Assigned
D) Reserved

Question 39

What is the purpose of the fund balance classification system for the general fund?

A) Report on a full accrual basis.
B) Improve evaluation of resource availability.
C) Better measurement of actual costs of providing services.
D) Reduce the tendency to borrow to reduce deficits.

Question 40

On the balance sheet for the general fund, which fund balance category would report prepaid expenses?

A) Nonspendable
B) Restricted
C) Committed
D) Assigned

Question 41

A general fund's budgeted expenditures for the year are called:

A) Estimated expenditures
B) Encumbrances
C) Appropriations
D) Fund balance deficits

Question 42

A county general fund has $400 in estimated revenues, $5 in estimated other financing sources, $395 in appropriations, and $25 in estimated other financing uses. The beginning-of-year budget entry for the general fund will include a credit to

A) Estimated revenues.
B) Fund balance-unassigned.
C) Estimated other financing uses.
D) Cash.

Question 43

A county general fund has $400 in estimated revenues, $5 in estimated other financing sources, $395 in appropriations, and $25 in estimated other financing uses. The beginning-of-year budget entry for the general fund will include a debit to

A) Appropriations.
B) Fund balance-unassigned.
C) Estimated other financing uses.
D) Fund balance-restricted.

Question 44

The general fund has the following budget:
•$400,000 in estimated revenues,
•$410,000 in appropriations,
•$20,000 in estimated other financing sources, and
•$25,000 in estimated other financing uses.
If the general fund's balance in fund balance-unassigned was $60,000 at the beginning of the year, before the budget entry, what is its balance after the budget entry?

A) $45,000
B) $75,000
C) $40,000
D) $35,000

Question 45

The general fund collects taxes that are legally restricted for use in a future year. The amount of the collections is reported on the general fund's:

A) Operating statement as an other financing source.
B) Balance sheet as a liability.
C) Operating statement as revenues.
D) Balance sheet as a deferred inflow.

Question 46

Which one of the following is most likely to be accrued as revenue by the general fund prior to receiving the cash?

A) Fees levied for licenses and permits
B) Property tax revenues
C) Fines from speeding tickets
D) Proceeds from bond issues

Question 47

At the start of 2020, a county general fund issues property tax bills in the amount of $9,000,000. It expects to collect $8,800,000 from property owners, with the rest expected to be uncollectible. During the year, $8,750,000 in 2020 property taxes is collected. Of the remaining $250,000 in uncollected taxes at year-end, it is estimated that $100,000 will be collected within 60 days and the rest are uncollectible. Property tax revenue for 2020 is:

A) $8,750,000
B) $8,850,000
C) $8,800,000
D) $9,000,000

Question 48

Use the following information to answer bellow Questions.
At the beginning of 2020, the balance sheet of a county general fund reports $500,000 in property taxes receivable from 2019, of which $350,000 are considered uncollectible. During 2020 the county sends out tax bills in the amount of $10,000,000, of which $600,000 are expected to be uncollectible. Cash collections on 2019 taxes are $140,000, and the remaining uncollected taxes are written off. Cash collections on 2020 taxes are $9,500,000. Of the $500,000 uncollected at the end of 2020, $100,000 are expected to be collected within 60 days, $65,000 are expected to be collected more than 60 days after year-end, and the rest are uncollectible.

-How does activity in 2020 related to 2019 taxes affect 2020 property tax revenue?

A) Increase of $140,000.
B) Increase of $10,000.
C) Reduction of $10,000.
D) No effect

Question 49

Use the following information to answer bellow Questions.
At the beginning of 2020, the balance sheet of a county general fund reports $500,000 in property taxes receivable from 2019, of which $350,000 are considered uncollectible. During 2020 the county sends out tax bills in the amount of $10,000,000, of which $600,000 are expected to be uncollectible. Cash collections on 2019 taxes are $140,000, and the remaining uncollected taxes are written off. Cash collections on 2020 taxes are $9,500,000. Of the $500,000 uncollected at the end of 2020, $100,000 are expected to be collected within 60 days, $65,000 are expected to be collected more than 60 days after year-end, and the rest are uncollectible.

-What are total property tax revenues for 2020, related to 2020 tax bills?

A) $10,000,000
B) $ 9,400,000
C) $ 9,500,000
D) $ 9,600,000

Question 50

Use the following information to answer bellow Questions.
At the beginning of 2020, the balance sheet of a county general fund reports $500,000 in property taxes receivable from 2019, of which $350,000 are considered uncollectible. During 2020 the county sends out tax bills in the amount of $10,000,000, of which $600,000 are expected to be uncollectible. Cash collections on 2019 taxes are $140,000, and the remaining uncollected taxes are written off. Cash collections on 2020 taxes are $9,500,000. Of the $500,000 uncollected at the end of 2020, $100,000 are expected to be collected within 60 days, $65,000 are expected to be collected more than 60 days after year-end, and the rest are uncollectible.

-The general fund's balance sheet at the end of 2020 will include:

A) Property taxes receivable, net of uncollectibles, of $100,000
B) Deferred inflows of $65,000
C) Property taxes receivable, net of uncollectibles, of $500,000
D) Deferred inflows of $165,000

Question 51

Use the following information to answer bellow Questions.
On January 1, 2020, a county government sends out property tax bills in the amount of $100,000,000. Of this amount, $15,000,000 is estimated to be uncollectible. During the year, $88,000,000 is collected. Of the $12,000,000 in uncollected taxes at December 31, 2020, $3,000,000 is expected to be collected within the next 60 days, and $1,800,000 is expected to be collected after 60 days. The rest are estimated to be uncollectible. In 2021, $10,000,000 is collected related to 2020 tax bills, and the remaining uncollected 2020 taxes are written off.

-What is the balance in the allowance for uncollectible taxes on the December 31, 2020 general fund balance sheet?

A) $12,000,000
B) $ 9,000,000
C) $ 7,200,000
D) $10,200,000

Question 52

Use the following information to answer bellow Questions.
On January 1, 2020, a county government sends out property tax bills in the amount of $100,000,000. Of this amount, $15,000,000 is estimated to be uncollectible. During the year, $88,000,000 is collected. Of the $12,000,000 in uncollected taxes at December 31, 2020, $3,000,000 is expected to be collected within the next 60 days, and $1,800,000 is expected to be collected after 60 days. The rest are estimated to be uncollectible. In 2021, $10,000,000 is collected related to 2020 tax bills, and the remaining uncollected 2020 taxes are written off.

-What is the balance for property tax revenues, as reported on the general fund operating statement for 2020?

A) $88,000,000
B) $91,000,000
C) $92,800,000
D) $85,000,000

Question 53

Use the following information to answer bellow Questions.
On January 1, 2020, a county government sends out property tax bills in the amount of $100,000,000. Of this amount, $15,000,000 is estimated to be uncollectible. During the year, $88,000,000 is collected. Of the $12,000,000 in uncollected taxes at December 31, 2020, $3,000,000 is expected to be collected within the next 60 days, and $1,800,000 is expected to be collected after 60 days. The rest are estimated to be uncollectible. In 2021, $10,000,000 is collected related to 2020 tax bills, and the remaining uncollected 2020 taxes are written off.

-How much property tax revenue, related to 2020 tax bills, is reported in 2021?

A) $ 7,000,000
B) $10,000,000
C) $ 5,200,000
D) $ 7,200,000

Question 54

A government orders services in the amount of $5,000,000 and records the order as an encumbrance. When the services are provided, the invoice is in the amount of $4,998,000. Which statement below is true?

A) When the invoice is received, the encumbrance account is debited for $5,000,000.
B) When the invoice is received, fund balance-assigned is debited for $4,998,000.
C) When the order is placed, fund balance-assigned is credited for $5,000,000.
D) When the order is placed, expenditures are debited for $5,000,000.

Question 55

A general fund uses the consumption method to record inventories. Beginning inventories are $10,000, purchases are $600,000, and ending inventories are $12,000. The general fund will report inventory expenditures of:

A) $600,000
B) $602,000
C) $612,000
D) $598,000

Question 56

A general fund uses the consumption method to record inventories. Beginning inventories are $10,000, purchases are $600,000, and ending inventories are $12,000. The general fund records an end-of-year adjusting entry that:

A) Debits nonspendable fund balance by $2,000
B) Credits nonspendable fund balance by $12,000
C) Debits unassigned fund balance by $2,000
D) Debits nonspendable fund balance by $12,000

Question 57

Use the following information to answer bellow questions
A county's general fund has $4,000,000 in supplies on hand at the start of 2020. It purchases $25,000,000 in supplies and uses supplies costing $26,000,000 during 2020.

-If the county uses the consumption method to report supplies inventories, what balances appear in the general fund financial statements for 2020?

A) Expenditures of $26,000,000 and fund balance-nonspendable of $3,000,000
B) Expenditures of $25,000,000 and no nonspendable fund balance
C) Expenditures of $25,000,000 and fund balance-nonspendable of $3,000,000
D) Expenditures of $26,000,000 and no nonspendable fund balance

Question 58

Use the following information to answer bellow questions
A county's general fund has $4,000,000 in supplies on hand at the start of 2020. It purchases $25,000,000 in supplies and uses supplies costing $26,000,000 during 2020.

-If the county uses the purchases method to report supplies inventories, what balances appear in the general fund financial statements for 2020? Assume the supplies inventories are not material.

A) Expenditures of $26,000,000 and fund balance-nonspendable of $3,000,000
B) Expenditures of $25,000,000 and no nonspendable fund balance
C) Expenditures of $25,000,000 and fund balance-nonspendable of $3,000,000
D) Expenditures of $26,000,000 and no nonspendable fund balance

Question 59

Use the following information to answer bellow questions
A county's general fund has $4,000,000 in supplies on hand at the start of 2020. It purchases $25,000,000 in supplies and uses supplies costing $26,000,000 during 2020.

-If the consumption method is used, what adjusting entry is required at year-end?

A) Debit fund balance-nonspendable, credit supplies inventory for $1,000,000.
B) Debit supplies inventory, credit fund balance-unassigned for $1,000,000
C) Debit fund balance-unassigned, credit fund balance-nonspendable for $1,000,000
D) Debit fund balance-nonspendable, credit fund balance-unassigned for $1,000,000

Question 60

A general fund makes payments to the debt service fund, as follows:
•$4,000,000, as legally authorized in the budget, for payment of principal due on general obligation debt
•$2,000,000, as legally authorized in the budget, for payment of interest due on general obligation debt
•$500,000 temporary transfer, to be paid back when the debt service fund receives funding from other sources
The above transactions reduce the general fund's fund balance-unassigned by what amount?

A) $ 500,000
B) $6,000,000
C) $6,500,000
D) $2,500,000

Question 61

A municipality's general fund transmits cash to the debt service fund to finance principal payments on general obligation debt. The debt service fund is not expected to pay the general fund back. How will this transaction be recorded by the general fund and the debt service fund?
$\begin{array} { l l } & \text { General Fund } &&&&&&&\text {Debt Service Fund}\\ \end{array}$

A) $\begin{array} { l l }\text { Increase in current receivables } &\text {Increase in current payables}\\\end{array}$
B) $\begin{array} { l l }\text { Expenditure }&&&&&&&&\text {Revenue} \\ \end{array}$
C) $\begin{array} { l l } \text { Other financing use } &&&&\text {Increase in current payables}\\\end{array}$
D) $\begin{array} { l l } \text { Other financing use } &&&&\text {Other financing source}\end{array}$

Question 62

Use the following information to answer bellow Questions
A county acquires equipment for $16,000,000 at the beginning of 2015. The equipment has an 8-year life, no residual value. At the beginning of 2021 (6 years later), the equipment is sold for $9,000,000. Use straight-line depreciation, if appropriate.

-The equipment is used for a parking garage and is reported in an enterprise fund. What is reported in the enterprise fund's operating statement, related to this equipment, in 2015?

A) The equipment is not reported in the operating statement
B) Expense of $16,000,000
C) Expense of $2,000,000
D) Expenditure of $16,000,000

Question 63

Use the following information to answer bellow Questions
A county acquires equipment for $16,000,000 at the beginning of 2015. The equipment has an 8-year life, no residual value. At the beginning of 2021 (6 years later), the equipment is sold for $9,000,000. Use straight-line depreciation, if appropriate.

-The equipment is used for general operations and is reported in the general fund. What is reported in the general fund's operating statement, related to this equipment, in 2015?

A) The equipment is not reported in the operating statement
B) Expense of $16,000,000
C) Expense of $2,000,000
D) Expenditure of $16,000,000

Question 64

Use the following information to answer bellow Questions
A county acquires equipment for $16,000,000 at the beginning of 2015. The equipment has an 8-year life, no residual value. At the beginning of 2021 (6 years later), the equipment is sold for $9,000,000. Use straight-line depreciation, if appropriate.

-The equipment is used for a parking garage and is reported in an enterprise fund. What is reported in the enterprise fund's operating statement, related to this equipment, in 2021?

A) Other financing source, $9,000,000
B) Gain on sale, $5,000,000
C) Revenue, $9,000,000
D) Loss on sale, $7,000,000

Question 65

Use the following information to answer bellow Questions
A county acquires equipment for $16,000,000 at the beginning of 2015. The equipment has an 8-year life, no residual value. At the beginning of 2021 (6 years later), the equipment is sold for $9,000,000. Use straight-line depreciation, if appropriate.

-The equipment is used for general operations and is reported in the general fund. What is reported in the general fund's operating statement, related to this equipment, in 2018?

A) Other financing source, $9,000,000
B) Gain on sale, $5,000,000
C) Revenue, $9,000,000
D) Loss on sale, $7,000,000

Question 66

A county government borrows $1,500,000 from a local bank at the beginning of 2019, to fund general operations. Principal and $90,000 in interest ($45,000 per year) are both due two years later when the loan is repaid at the end of 2020. The loan is reported in the general fund. Which statement below is true concerning the general fund?

A) Fund balance is not affected in 2019.
B) Fund balance is reduced by $45,000 in 2019.
C) Fund balance decreases by $1,500,000 in 2020.
D) Fund balance decreases by $1,590,000 in 2020.

Question 67

The general fund has the following transactions for 2020:
•Issued $1,000,000 face value bonds with a coupon rate of 3%.
•Made a $100,000 principal payment on the bonds.
•Made a $25,000 interest payment on the bonds.
•Accrued interest due in 2021 on the bonds is $5,000.
What is the effect of the above transactions on the general fund's fund balance in 2020?

A) $30,000 decrease
B) $875,000 increase
C) $25,000 decrease
D) $970,000 increase

Question 68

A county's general fund has the following results for fiscal 2020:
$$\begin{array} { l l l } & \text { Budget } & \text { Actual } \\\text { Revenues } & \$ 405,000 & \$ 400,000 \\\text { Expenditures } & 380,000 & 375,000 \\\text { Other financing uses } & 30,000 & 28,000\end{array}$$ If the general fund's balance in fund balance-unassigned before the budget entry was $26,000, what is its balance at the end of fiscal 2020, after closing entries?

A) $29,000
B) $23,000
C) $18,000
D) $16,000

Question 69

Use the following information to answer bellow Questions
A county's general fund has $4,000,000 in purchase orders outstanding at the beginning of 2020. The orders are delivered in 2020 and the county pays the suppliers $4,000,000. Expenditures ordered, delivered and paid for in 2020 total $35,000,000. Near the end of 2020, encumbrances for $5,000,000 in purchase orders are recorded. Encumbrances are reported in fund balance-assigned.

-Using the legal budgetary basis, what amount does the county report for expenditures in 2020?

A) $39,000,000
B) $40,000,000
C) $35,000,000
D) $44,000,000

Question 70

Use the following information to answer bellow Questions
A county's general fund has $4,000,000 in purchase orders outstanding at the beginning of 2020. The orders are delivered in 2020 and the county pays the suppliers $4,000,000. Expenditures ordered, delivered and paid for in 2020 total $35,000,000. Near the end of 2020, encumbrances for $5,000,000 in purchase orders are recorded. Encumbrances are reported in fund balance-assigned.

-Using the GAAP budgetary basis, what amount does the county report for expenditures in 2020?

A) $39,000,000
B) $40,000,000
C) $35,000,000
D) $44,000,000

Question 71

Use the following information to answer bellow Questions
A county's general fund has $4,000,000 in purchase orders outstanding at the beginning of 2020. The orders are delivered in 2020 and the county pays the suppliers $4,000,000. Expenditures ordered, delivered and paid for in 2020 total $35,000,000. Near the end of 2020, encumbrances for $5,000,000 in purchase orders are recorded. Encumbrances are reported in fund balance-assigned.

-At the end of 2020, to what fund balance account are the $4,000,000 in expenditures related to beginning-of-year encumbrances closed, using each basis of reporting?
$\begin{array} { l l l l } & \text { Legal Budgetary Basis } & & \text { GAAP Budgetary Basis } \\\end{array}$

A) $\begin{array} { l l l l } \text { Fund balance-assigned } & & \text { Fund balance-unassigned } \\\end{array}$
B) $\begin{array} { l l l l } \text { Fund balance-unassigned } & \text { Fund balance-assigned } \\\end{array}$
C) $\begin{array} { l l l l } \text { Fund balance-assigned } & & \text { Fund balance-assigned } \\\end{array}$
D) $\begin{array} { l l l l } \text { Fund balance-unassigned } & \text { Fund balance-unassigned }\end{array}$

Question 72

Encumbrances for $900,000 in purchase orders are outstanding at the beginning of 2020. Encumbrances for $800,000 in purchase orders are outstanding at the end of 2020. Which statement is true concerning a comparison of legal budgetary and GAAP budgetary expenditures for 2020?

A) Legal budgetary basis expenditures are $800,000 higher.
B) GAAP budgetary basis expenditures are $100,000 higher.
C) Legal budgetary basis expenditures are $100,000 higher.
D) GAAP budgetary basis expenditures are $900,000 higher.

Question 73

Use the following information to answer bellow Questions
bellow is the preclosing trial balance of a town's general fund at year-end:
$$\begin{array} { | l | r | r | } \hline & { \text { Dr } } & { \text { Cr } } \\\hline \text { Cash } & {\$ 8,000 } & \\\hline \text { Property taxes receivable, net } & 35,000 & \\\hline \text { Estimated revenues } & 1,000,000 & \\\hline \text { Estimated other financing sources } & 15,000 & \\\hline \text { Operating expenditures } & 1,003,000 & \\\hline \text { Accounts payable } & & 40,000 \\\hline \text { Appropriations } & & 1,005,000 \\\hline \text { Property tax revenues } & & 989,000 \\\hline \text { Bond proceeds } & & 15,000 \\\hline \text { Fund balance-unassigned } & & 12,000 \\\hline & \underline { \mathbf { \$ 2 , 0 6 1 , 0 0 0 } } & \underline { \mathbf { \$ 2 , 0 6 1 , 0 0 0 } } \\\hline\end{array}$$

-A county uses the GAAP basis to report encumbrances. At the end of 2020 there are purchase orders outstanding, for which the goods have not yet been delivered, for $40,000. Which statement below is false?

A) Expenditures for 2020 will include the $40,000 purchase orders.
B) An entry will be made at the start of 2021 to increase fund balance-unassigned by $40,000.
C) If the actual cost of the orders turns out to be $42,000, then $42,000 will be added to expenditures for 2021.
D) The expenditures connected with the purchase orders outstanding at the end of 2020 are not separated from expenditures initiated in 2021.

Question 74

Use the following information to answer bellow Questions
bellow is the preclosing trial balance of a town's general fund at year-end:
$$\begin{array} { | l | r | r | } \hline & { \text { Dr } } & { \text { Cr } } \\\hline \text { Cash } & {\$ 8,000 } & \\\hline \text { Property taxes receivable, net } & 35,000 & \\\hline \text { Estimated revenues } & 1,000,000 & \\\hline \text { Estimated other financing sources } & 15,000 & \\\hline \text { Operating expenditures } & 1,003,000 & \\\hline \text { Accounts payable } & & 40,000 \\\hline \text { Appropriations } & & 1,005,000 \\\hline \text { Property tax revenues } & & 989,000 \\\hline \text { Bond proceeds } & & 15,000 \\\hline \text { Fund balance-unassigned } & & 12,000 \\\hline & \underline { \mathbf { \$ 2 , 0 6 1 , 0 0 0 } } & \underline { \mathbf { \$ 2 , 0 6 1 , 0 0 0 } } \\\hline\end{array}$$

-What was the credit balance in fund balance-unassigned at the beginning of the year, before the budget entry was made?

A) $14,000
B) $ 7,000
C) $ 2,000
D) $12,000

Question 75

What is the fund balance-unassigned, appearing on the general fund's year-end balance sheet?

A) $12,000 credit
B) $ 2,000 debit
C) $ 2,000 credit
D) $ 3,000 credit

Question 76

Use the following information to answer bellow Questions
bellow is the preclosing trial balance of a county's general fund at year-end:
$$\begin{array} { | l | r | r | } \hline & { \text { Dr } } & { \text { Cr } } \\\hline \text { Cash } & { 45,000 } & \\\hline \text { Property taxes receivable } & 180,000 & \\\hline \text { Due from other funds } & 25,000 & \\\hline \text { Estimated revenues } & 2,300,000 & \\\hline \text { Operating expenditures } & 1,963,000 & \\\hline \text { Capital outlay } & 120,000 & \\\hline \text { Debt service: Principal } & 50,000 & \\\hline \text { Debt service: Interest } & 140,000 & \\\hline \text { Transfersout } & 29,000 & \\\hline \text { Allowance for unco llectible property taxes } & & \$ 150,000 \\\hline \text { Accounts payable } & & 45,000 \\\hline \text { Due to other funds } & & 22,000 \\\hline \text { Appropriations } & & 2,275,000 \\\hline \text { Estimated other financing uses } & & 30,000 \\\hline \text { Property tax revenues } & & 2,295,000 \\\hline \text { Fund balance-unassigned } & & 35,000 \\\hline & \underline { \underline { \$ 4,852,000 } } & \underline { \underline { \mathbf { \$ 4 , 8 5 2 , 0 0 0 } } } \\\hline\end{array}$$

-What was the credit balance in fund balance - unassigned at the beginning of the year, before the budget entry was made?

A) $40,000
B) $30,000
C) $35,000
D) $25,000

Question 77

Use the following information to answer bellow Questions
bellow is the preclosing trial balance of a county's general fund at year-end:
$$\begin{array} { | l | r | r | } \hline & { \text { Dr } } & { \text { Cr } } \\\hline \text { Cash } & { 45,000 } & \\\hline \text { Property taxes receivable } & 180,000 & \\\hline \text { Due from other funds } & 25,000 & \\\hline \text { Estimated revenues } & 2,300,000 & \\\hline \text { Operating expenditures } & 1,963,000 & \\\hline \text { Capital outlay } & 120,000 & \\\hline \text { Debt service: Principal } & 50,000 & \\\hline \text { Debt service: Interest } & 140,000 & \\\hline \text { Transfersout } & 29,000 & \\\hline \text { Allowance for unco llectible property taxes } & & \$ 150,000 \\\hline \text { Accounts payable } & & 45,000 \\\hline \text { Due to other funds } & & 22,000 \\\hline \text { Appropriations } & & 2,275,000 \\\hline \text { Estimated other financing uses } & & 30,000 \\\hline \text { Property tax revenues } & & 2,295,000 \\\hline \text { Fund balance-unassigned } & & 35,000 \\\hline & \underline { \underline { \$ 4,852,000 } } & \underline { \underline { \mathbf { \$ 4 , 8 5 2 , 0 0 0 } } } \\\hline\end{array}$$

-What is the year-end balance in fund balance-unassigned?

A) $11,000
B) $62,000
C) $28,000
D) $33,000

Question 78

Use the following information to answer bellow Questions
bellow is the preclosing trial balance of a county's general fund at year-end:
$$\begin{array} { | l | r | r | } \hline & { \text { Dr } } & { \text { Cr } } \\\hline \text { Cash } & { 45,000 } & \\\hline \text { Property taxes receivable } & 180,000 & \\\hline \text { Due from other funds } & 25,000 & \\\hline \text { Estimated revenues } & 2,300,000 & \\\hline \text { Operating expenditures } & 1,963,000 & \\\hline \text { Capital outlay } & 120,000 & \\\hline \text { Debt service: Principal } & 50,000 & \\\hline \text { Debt service: Interest } & 140,000 & \\\hline \text { Transfersout } & 29,000 & \\\hline \text { Allowance for unco llectible property taxes } & & \$ 150,000 \\\hline \text { Accounts payable } & & 45,000 \\\hline \text { Due to other funds } & & 22,000 \\\hline \text { Appropriations } & & 2,275,000 \\\hline \text { Estimated other financing uses } & & 30,000 \\\hline \text { Property tax revenues } & & 2,295,000 \\\hline \text { Fund balance-unassigned } & & 35,000 \\\hline & \underline { \underline { \$ 4,852,000 } } & \underline { \underline { \mathbf { \$ 4 , 8 5 2 , 0 0 0 } } } \\\hline\end{array}$$

-On the general fund operating statement, what is the total for other financing uses?

A) $29,000
B) $-0-
C) $79,000
D) $30,000

Question 79

Use the following information to answer bellow Questions
bellow is the preclosing trial balance of a county's general fund at year-end:
$$\begin{array} { | l | r | r | } \hline & { \text { Dr } } & { \text { Cr } } \\\hline \text { Cash } & { 45,000 } & \\\hline \text { Property taxes receivable } & 180,000 & \\\hline \text { Due from other funds } & 25,000 & \\\hline \text { Estimated revenues } & 2,300,000 & \\\hline \text { Operating expenditures } & 1,963,000 & \\\hline \text { Capital outlay } & 120,000 & \\\hline \text { Debt service: Principal } & 50,000 & \\\hline \text { Debt service: Interest } & 140,000 & \\\hline \text { Transfersout } & 29,000 & \\\hline \text { Allowance for unco llectible property taxes } & & \$ 150,000 \\\hline \text { Accounts payable } & & 45,000 \\\hline \text { Due to other funds } & & 22,000 \\\hline \text { Appropriations } & & 2,275,000 \\\hline \text { Estimated other financing uses } & & 30,000 \\\hline \text { Property tax revenues } & & 2,295,000 \\\hline \text { Fund balance-unassigned } & & 35,000 \\\hline & \underline { \underline { \$ 4,852,000 } } & \underline { \underline { \mathbf { \$ 4 , 8 5 2 , 0 0 0 } } } \\\hline\end{array}$$

-The general fund's year-end balance sheet will report total liabilities of:

A) $ 45,000
B) $195,000
C) $ 67,000
D) $217,000

Question 80

Use the following information to answer bellow Questions
bellow is the preclosing trial balance of a county's general fund at year-end:
$$\begin{array} { | l | r | r | } \hline & { \text { Dr } } & { \text { Cr } } \\\hline \text { Cash } & { 45,000 } & \\\hline \text { Property taxes receivable } & 180,000 & \\\hline \text { Due from other funds } & 25,000 & \\\hline \text { Estimated revenues } & 2,300,000 & \\\hline \text { Operating expenditures } & 1,963,000 & \\\hline \text { Capital outlay } & 120,000 & \\\hline \text { Debt service: Principal } & 50,000 & \\\hline \text { Debt service: Interest } & 140,000 & \\\hline \text { Transfersout } & 29,000 & \\\hline \text { Allowance for unco llectible property taxes } & & \$ 150,000 \\\hline \text { Accounts payable } & & 45,000 \\\hline \text { Due to other funds } & & 22,000 \\\hline \text { Appropriations } & & 2,275,000 \\\hline \text { Estimated other financing uses } & & 30,000 \\\hline \text { Property tax revenues } & & 2,295,000 \\\hline \text { Fund balance-unassigned } & & 35,000 \\\hline & \underline { \underline { \$ 4,852,000 } } & \underline { \underline { \mathbf { \$ 4 , 8 5 2 , 0 0 0 } } } \\\hline\end{array}$$

-On the general fund operating statement, what are total expenditures?

A) $2,302,000
B) $2,273,000
C) $2,103,000
D) $2,223,000