ACCY161 Final

Which of the following is NOT a characteristic of a fund as defined by GASB standards?
A. An accounting entity
B. A fiscal entity
C. A segregated quantity of cash and other financial resources on deposit with a designated trustee
D. A self-balancing set of accounts

The GASB has identified which of the following as the "cornerstone" of all financial reporting in government?
A. Understandability
B. Representational faithfulness
C. Accountability
D. Visibility
E. Both accountability and visibility

The types of funds that may be used in governmental accounting are classified into the categories of activities performed by governments:
A. None are correct
B. Governmental, business-type, and fiduciary
C. Governmental, proprietary, and fiduciary
D. Governmental activities, business-type activities

The government-wide financial statements are intended to report on ___________ :
A. Financial resources
B. Fiscal accountability
C. Operational accountability
D. Both financial resources and operational accountability
E. Both fiscal and operational accountability

The dual track includes:
A. The fund track
B. The modified accrual track
C. The government-wide track
D. Both the fund track and the government-wide track
E. The fund, modified accrual, and government-wide tracks are all correct terminology

An example of other financing sources would be:
A. Grants for capital improvements
B. Proceeds of the sale of bonds
C. Sales of tax anticipation notes
D. Both grants and bond sales
E. All are correct

In governmental financial reporting the internal service fund is included in:
A. Business-type activities
B. Governmental activities
C. Governmental funds
D. Both government and business-type activities
E. None are correct - it is reported separately

The measurement focus of economic resources is related to:
A. Governmental activities financial statements
B. Business-type activities financial statements
C. Fiduciary funds financial statements
D. Both governmental and business-type activities financial statements
E. All are correct

When equipment that is to be used by an activity accounted for by the General Fund of a government is received, it should be recorded in the General Fund as a(an):
A. Appropriation
B. Expenditure
C. Encumbrance
D. Capital asset

In governmental financial reporting, the fiduciary funds are included in the:
A. Fund financial statements
B. Both statements
C. Governmental activities statements

The financial results of blended components are included in:
A. The governmental fund statements
B. They are included in both statements but disclosed differently
C. The government-wide statements

The section of the comprehensive annual financial report (CAFR) that presents tables and charts showing social and economic data in addition to financial trends and the fiscal capacity f the government is the:
A. Introductory section 
B. Statistical section
C. Management discussion and analysis (MD&A) section
D. Financial section

___________ refers to the concept that current-year revenues are sufficient to pay for services provided that year, so that future taxpayers will to be required to assume the burden for services previously provided:
A. All are correct
B. Responsibility accounting
C. Budgetary control
D. Interperoid equity

Recognizing revenues when measurable and available for paying current obligations and expenditures when incurred describes which basis of accounting?
A. Fund
B. Modified accrual
C. Accrual
D. Modified cash
E. Budgetary 

Estimated revenues has a:
a. Credit balance
b. Debit balance

When a vehicle is ordered by a government, the purchase order should be recorded in the General Fund as a debit to:
A. Encumbrances
B. Expenditures
C. Appropriations
D. Equipment

In accounting for state and local governments the modified accrual basis is recommended for:
A. Governmental funds only
B. Proprietary and fiduciary funds
C. Proprietary funds only
D. All funds

When the budget of a government is adopted and Estimated Revenues exceed Appropriations, the excess is:
A. Debited to Fund Balance
B. Debited to Reserve for Encumbrances
C. Credited to Fund Balance
D. None of these
E. Credited to Reserve for Encumbrances

Which of the following steps in the acquisition of goods and services by an activity accounted for by the General Fund occurs first?
A. Appropriation
B. Encumbrance
C. Expenditure
D. Disbursement

An example of a proprietary fund is a(an):
A. Special revenue fund
B. Investment trust fund
C. Internal service fund
D. Debt service fund
E. Both investment trust and internal service funds

When the budget of a government is recorded and Appropriations exceeds Estimated Revenues, the Fund Balance account is:
A. Credited at the beginning of the year and no entry is made at the end of the year
B. Debited at the beginning of the year dn credited at the end of the year
C. Debited at the beginning of the year and no entry is made at the end of the year
D. Credited at the beginning of the year and debited at the end of the year

The expenditures control account of a government is debited when:
A. The budget is recorded
B. Supplies are ordered
C. None of these
D. The invoice is paid
E. Supplies previously encumbered are received

The General Fund has transferred cash to the appropriate fund for eventual retirement of term bonds maturing in 10 years. Which funds would record this transaction?
A. General Fund: Yes; Capital Project Fund: No; Debt Service Fund: No
B. General Fund: Yes; Capital Projects Fund: Yes; Debt Service Fund: Yes
C. General Fund: Yes; Capital Projects Fund: No; Debt Service Fund: Yes
D. General Fund: No; Capital Projects Fund: No; Debt Service Fund: Yes

When supplies ordered for use in activity accounted for in the General Fund of a government are received at an actual price that is more than the estimated price on the purchase order, the Encumbrance account is:
A. Debited for the estimated price on the purchase order
B. Credited for the estimated price on the purchase order
C. Debited for the actual price for the supplies received
e. None of these

The measurement focus that should be used in preparing fund financial statements is:
A. Gov: current; Prop: economic; Fid: economic
B. Gov: current; Prop: economic; Fid: current
C. Gov: economic; Prop: current; Fid: current
D. Gov: current; Prop: current; Fid: economic

The basis of accounting that should be used in preparing fund financial statements is:
A. Gov: modified; Prop: accrual; Fid: accrual
B. Gov: modified; Prop: accrual; Fid: modified
C. Gov: accrual; Prop: modified; Fid: accrual
D. Gov: modified; Prop: modified; Fid: modified

The City of Orange just passed its annual budget and it was approved by the mayor. It included estimated property taxes of $5,000; sales and use taxes of $7,000; investment income of $1,000; the sales of bonds for a new police station of $3,000. Appropriations for
the year were estimated to be $15,000. The budgetary entry for Estimated Revenue would be:
A. None of these
B. $8,000
C. $13,000
D. $16,000
E. $12,000

The City of Orange just passed its annual budget and it was approved by the mayor. It included estimated property taxes of $5,000; sales and use taxes of $7,000; investment income of $1,000; the sales of bonds for a new police station of $3,000. Appropriations for
the year were estimated to be $15,000. Payroll payments are made for $500, this will result in:
A. A debit to Encumbrances
B. A debit to Expenditures
C. A debit to Appropriations
D. Both a debit to Encumbrances and Expenditures
E. All of these are correct

The City of Orange just passed its annual budget and it was approved by the mayor. It included estimated property taxes of $5,000; sales and use taxes of $7,000; investment income of $1,000; the sales of bonds for a new police station of $3,000. Appropriations for the year were estimated to be $15,000. Sales tax of $2,000 is collected. There is:
A. A credit to Accounts Receivable
B. A debit to Fund Balance
C. A credit to Estimated Revenues
D. A debit to Estimated Revenues
E. None of these are correct

The City of Orange just passed its annual budget and it was approved by the mayor. It included estimated property taxes of $5,000; sales and use taxes of $7,000; investment income of $1,000; the sales of bonds for a new police station of $3,000. Appropriations for
the year were estimated to be $15,000. When the bonds are sold there is an entry for:
A. Bonds payable
B. Other financing sources
C. Appropriations
D. Both Bonds Payable and Other Financing Sources
E. All of these are correct

The responsibility of governments to justify that their actions in the current period have complied with public decisions concerning the raising and spending of public monies in the short-term is known as:
A. Operational accountability
B. Fiscal accountability
C. Legal accountability
D. Fiduciary responsibility

Interest expenditures on bonds payable should be recorded:
A. At the end of the fiscal period if the interest due date does not coincide with the end of the fiscal period:
B. When paid
C. When bonds are issued
D. When legally payable

General capital assets used by departments accounted for by the General Fund of a governmental unit should be capitalized in:
A. The General Fund
B. The governmental activities journal
C. The general capital assets fund
D. The business-type activities journal

Which of the following funds is a governmental fund-type?
A. Internal service fund
B. Permanent fund
C. Private-purpose trust fund
D. Enterprise fund

In accounting for state and local governments the modified accrual basis is recommended for:
A. Proprietary and fiduciary funds
B. Al funds
C. Governmental funds only
D. Proprietary funds only

The modified accrual basis of accounting applicable to governmental fund types requires that revenues be recognized when:
A. Earned
B. Authorized by the budget ordinance
C. Measurable and available
D. Collected in cash
E. Both earned and measurable and available

The correct term for the liabilities in a governmental fund statement would be:
A. Current liabilities
B. All are correct
C. Fund liabilities
D. Legal liabilities

The accounting system used by a state or local government must make it possible:
A. To present fairly the financial position and results of financial operations of the government as a whole, as well as fund financial activity in conformity with GAAP, and to demonstrate compliance with finance-related legal and contractual provisions
B. All are correct
C. To prepare consolidated accrual basis statements for the government as a whole
D. To prepare financial statements as required by FASB

On what should the government-wide financial statements report?
A. Net assets and results of financial operations of the government as a whole
B. All of these are correct
C. The cost of government services
D. Operational accountability

The fund financial statements for governmental funds should include a:
A. Statements of revenues, expenses, and changes in fund net assets
B. A schedule of fixed assets by class
C. statement of cash flows
D. Balance sheet for governmental funds

Government-wide financial statements present the government's financial position using:
a Total financial resources measurement focus/accrual basis of accounting
b. Economic resources measurement focus/accrual basis of accounting
c. Current financial resources measurement focus/modified actual basis of accounting
d. Current financial resources measurement focus/cash basis of accounting

Which of the following are reported in the functions/programs section of the statement of activities at the government-wide level where they reduce the net expense of each function or program to produce a net revenue?
A. General revenues
B. Program revenues
C. None of these
D. Indirect revenues

Accountability for capital assets used by departments accounted for by the governmental funds of a government should be established in:
A. The appropriate governmental funds
B. The governmental activities accounts at the government-wide level
C. Departmental memorandum records
D. The property, plant, and equipment fund

Which of the following funds of a government uses the modified accrual basis of accounting?
A. Private-purpose trust fund
B. Internal service
C. Capital projects
D. Enterprise

Which of the following is NOT true for capital projects funds?
A. GASB standards require that construction work in progress be capitalized in the capital projects funds until the project is completed
B. Capital projects funds may account for financial resources provided by federal grants as well as for bond proceeds
C. Cash or receivables from special assessments to finance construction projects should be recorded as assets of capital projects funds
D. Encumbrance accounting is generally used

The liability for general obligation bonds should be recorded in:
A. Capital projects fund
B. General Fund
C. Governmental activities journal
D. Debt service fund

Proceeds from general obligation bonds should be recorded in the:
A. General obligation bond fund
B. Debt service fund
C. Capital projects fund
D. Permanent fund

Debt service funds are used to account for which of the following:
A. Payment of principal only on general long-term debt
B. Payment of principal and interest on all debt of the government, including that of enterprise funds
C. Payent of interest only on general long-term debt
D. Payment of principal and interest on general long-term debt

Which of the following funds of a government would account for depreciation?
A. Capital projects
B. Special revenue
C. General
D. Internal service

Under utility regulatory accounting principles (RAP), the account "Utility Plant Acquisition Adjustment" reflects:
A. The difference between the amount paid for the utility plant less its current replacement cost
B. The difference between the amount paid for the utility plant less the fair market value of its tangible plant assets
C. The difference between the fair market value of the utility plant and the amount paid for it, less accumulated depreciation
D. The difference between the amount paid for utility plans and the amount originally paid by the utility that first placed the plant into public service, less accumulated depreciation

For which of the following assets can the "modified approach" be elected in lieu of depreciation?
A. All capital assets
B. Buildings and equipment
C. Al general capital assets
D. Eligible infrastructure assets

The GASB reporting model requires, among other characteristics, that the accounting system:
A. Only show compliance and provide budgetary accounting
B. Provide an ability to show compliance with finance-related laws and regulations
C. Be on a fund basis, show compliance, and provide budgetary accounting
D. Provide budgetary accounting
E. Be on the fund basis

Estimated revenues are found in:
A. Governmental Fund Accounting. Just the governmental funds, do not consider the proprietary or fiduciary funds
B. Government-Wide Accounting
C. Both Governmental Fund Accounting and Government-Wide Accounting
D. Neither Governmental Fund Accounting nor Government-Wide Accounting

Program revenues:
A. Are used to calculate net expenses
B. Are usually in the form of a tax
C. Can be from exchange or non-exchange transactions
D. All of these characterize program revenue

Which of the following terms indicate or relate to the idea of the primary government and all related units:
A. Fund equity
B. Blended presentation
C. Discrete presentation
D. Modified accrual basis 
E. Governmental activities
F. Component unit
G. Accrual basis
H. Reporting entity

One of the characteristics government-wide financial statements reporting includes:
A. Net assets and results of financial operations of the government as a whole
B. Fiscal accountability
C. Financial resources focus
D. Budgetary compliance
E. Both net assets and fiscal accountability

As discussed in the text, the use of budgetary accounts and budgetary accounting is supported by:
A. Common practice in the public sector 
B. Federal laws if a state expects to get grants
C. GASB standards
D. State laws

The following occurred for the City of Salem for the fiscal year ending June 30, 2011: the budget included estimated revenues of $600 and appropriations of $500. Purchase orders of $400 were issued. $200 worth of the items on the purchase orders were received with related invoices of $210. The invoices were approved and paid. What is the balance in the available appropriations at this point?
A. $80 
B. $300
C. $110
D. $90
E. $120

When supplies ordered for use in an activity accounted for in the General Fund are received at an actual price that is more than the estimated price on the purchase order, the Encumbrance account is:
A. Credited for the actual price for the supplies received
B. Debited for the estimated price on the purchase order
C. Debited for the actual price for the supplies received
D. Credited for the estimated price on the purchase order

The payments made for fixed assets is found in which of the following:
A. Governmental Fund Accounting
B. Just the governmental funds, do not consider the proprietary or fiduciary funds
C. Government-Wide Accounting 
D. Both Governmental Fund Accounting and Government-Wide Accounting
E. Neither Governmental Fund Accounting nor Government-Wide Accounting

A debt service fund is a:
A. Proprietary fund
B. Governmental fund
C. Nonexpendable fund
D. Fiduciary fund

The following occurred for the City of Salem for the fiscal year ending June 30, 2011: the budget included estimated revenues of $600 and appropriations of $500. Purchase orders of $400 were issued. $200 worth of the items on the purchase orders were received with related invoices of $190. The invoices were approved and paid. What is the balance in the encumbrances account at this point?
A. $300 
B. $200
C. $100
D. $220
E. $90

Which of the following is a true statement regarding in-substance defeasance of bonds?
A. The government must agree to maintain sufficient unrestricted cash and investments in its governmental funds to cover all interest and principal payments for the debt being defeased
B. The government must agree to maintain sufficient cash and investment balances in its debt service fund to cover all interest and principal payments for the debt being defeased
C. The government must pledge to transfer amounts to an escrow agent prior to the due date for each interest and principal payment for the debt being defeased
D. The government must place cash or other assets in an irrevocable trust sufficient to pay all future interest and principal payments for the debt being defeased

For the following transactions or events in the capital projects fund, what would be the correct accounting treatment from the options provided: Purchase orders for $700,000 were issued for park amenities which are to be funded by the sales of bonds:
A. All of these are correct
B. A debit to encumbrances
C. A credit to bonds payable
D. A debit to fixed assets 

A local civic organization gave the city government $15,000 cash to be used to pay the utility bills of persons whose incomes were below the poverty level. The city should account for the $15,000 gift in:
A. A permanent fund
B. Private-purpose trust fund
C. The General Fund
D. An investment trust fund

The year-end financial statements for a governmental entity could  include balances in the following accounts:
A. Fund balance and Reserve for encumbrances
B. Reserve for encumbrances
C. Budgetary fund balance
D. Encumbrances
E. Fund balance

Transactions for internal service fund can be found in:
A. The fund financial statements
B. The government-wide financial statements
C. Both the fund financial statements and the government-wide financial statements

When securites with a cost of $5000 are transferred from the debt service fund to an investment pool fund and the market value of the securities is $6000 the following occur:
A. #1 - there is a debit to the debt service fund for $5000
B. #2 - there is a credit to the investment pool for the $5000
C. #3 - both #1 and #2 are correct
D. #4 - revenue is recongnized on both the debt service fund and the investment pool fund
E. #5 - reveune is recongnized only on the debt service fund
F. #6 - #'s 1, 2, and 4 are all correct

Jefferson County developed a community park from land abandoned by the federal government. The county uses both a capital projects fund and a debt service fund in developing the park. The county issued a contract to develop the park for $700,000.  The following accounting entry(ies) will result.  Select all that are correct so you may have more than one answer:
a. An encumbrance entry in the general fund 
b. An encumbrance entry in the capital project fund
b. A credit entry in the debt service fund for the liability for the contract
c. A debit to construction-in-progress
d. A debit to cash in the capital projects fund for $700,000

Which of the following is NOT true regarding proprietary funds?
A. Proprietary funds present a statement of cash flows
B. The difference between assets and liabilities of proprietary funds is called "fund balance"
C. Proprietary funds record capital assets directly in the fund accounts
D. Proprietary funds record long-term debt directly in the fund accounts

How should financial information for internal service funds be reported in the government-wide financial statements?
A. Amounts allocated proportionately between governmental and business-type activities
B. As part of business-type activities
C. As part of governmental activities
D. Usually as part of governmental activities, unless the internal service fund predominantly serves one or more enterprise funds

In terms of year-end closing entries, which of the following is true:
A. Neither are correct
B. The capital projects fund does not have closing entries at the end of the year, only when the project is completed are closing entries used
C. Both are correct
D. The accounts in the governmental activities accounts related to just the capital asset are not closed at the end of the year

An area that the city services auditor examines for the CCSF as discussed in class is:
A. #2 and #3 are correct
B. #1 the review of the CAFR process for professional standards
C. #1 and # 2 and #3 are all correct
D. #3 if the streets are clean
E. #2 the status of the various parks
F. #1 and #2 are correct 

Which of the following financial concepts has been defined by the GASB as "the probability that a government will meet both its financial obligations to creditors, consumers, employees, taxpayers, suppliers, constituents, and others as they become due and its service obligation to constituents, both currently and in the future?
A. Financial position
B. Financial condition
C. Financial leverage
D. Liquidity

Which of the following debt service fund accounts would not be closed at the end of each fiscal year?
A. Fund Balance
B. Revenues
C. They would all be closed at the end of the year
D. Estimated Revenues
E. Expenditures—Bond Interest

Which of the following would not be included within the financial section of the comprehensive annual financial report (CAFR)?a. Letter of transmittal
b. Management's discussion and analysis (MD&A)
c. Independent auditor's report
d. Required supplementary information (RSI)

A tax agency fund agrees to collect $10,000 in property taxes for the Santana School District. Which of the following are correct?
A. #3 There is a debit to an accounts receivable on the agency accounts
B. #2 A budget entry is required on the agency’s accounts 
C. #2 and #3 are correct
D. None of the answers are correct
E. #1 No entry is required

Which of the following is the appropriate measurement focus for agency funds?
A. Current financial resources
B. Economic resources
C. Accrual basis
D. Cash and cash equivalents

Encumbrances are reestablished:
A. With an accounting entry at the end of the fiscal year 
B. With an accounting entry at the start of the fiscal year
C. Encumbrances expire at the end of the fiscal (budget) year and are not re-established

The debt service fund for the City of Harrison collected property taxes to be used for debt payments.  The following entry will be made on the on the debt service fund’s books:
A. A credit to other financing sources
B. A credit to other financing uses
C. A credit to transfers in 
D. A credit to revenue
E. A credit to accounts receivable
F. No entry will be made, the entry will be made on the books for the City of Harrison’s general fund

Which of the following grants received by a city would most appropriately be recorded in a "pass-through" agency fund?
A. A federal grant for various purposes, for which the ultimate allocation and use of the money will be decided by the state government. The city will serve as a conduit for the money between the state government and various not-for-profit organizations who will use the money
B. A state grant to a local not-for-profit organization for summer employment of juveniles
C. A federal grant made directly to a county for repairing and overhauling bridges
D. A federal grant via the state government for which the city will be responsible for upgrading low-rent housing.

The sale of tax-supported bonds at par for the eventual construction of a new city jail would require recognition in which of the following funds and/or activities?
A. Capital projects and debt service funds
B. Debt service fund, capital projects, and governmental activities
C. Debt service fund and the governmental activities
D. Capital projects fund and the governmental activities

The term “the nut” as discussed in class is found in:
A. Governmental Fund Accounting
B. Just the governmental funds, do not consider the proprietary or fiduciary funds
C. Government-Wide Accounting
D. Both Governmental Fund Accounting and Government-Wide Accounting
E. Neither Governmental Fund Accounting nor Government-Wide Accounting

The budgetary accounts, as discussed in the text, are considered:
A. All are correct
B. Part of the fund equity
C. Discretionary accounts 
D. As a separate set of accounts that are reconciled at the end of the year

The liability for general obligation bonds should be recorded in the:
A. Debt service fund
B. Capital projects fund
C. Governmental activities journal
D. General Fund

Residual equity in a capital projects fund are generally transferred to what fund?
A. General
B. Debt service
C. Special revenue
D. Internal service fund

Interfund transfers and debt issue proceeds received by the General Fund would be recorded as:
A. Other proceeds
B. Would not be recorded by the General Fund – only on the government-wide side
C. Other financing activities
D. Other financing sources

General purpose external financial statements include:
A. Governmental Fund Accounting
B. Just the governmental funds, do not consider the proprietary or fiduciary funds
C. Government-Wide Accounting 
D. Both Governmental Fund Accounting and Government-Wide Accounting
E. Neither Governmental Fund Accounting nor Government-Wide Accounting

Component units are reported in the financial statements using the following term(s):
A. Separate
B. Blended and discrete
C. Blended
D. Fund based and separated
E. Discrete
F. Fund based

The account balance in the other financing uses account is normally a:
A. Debit
B. The normal balance can be either  a debit or a credit
C. Credit

On the due date for bond interest, the debt service fund journal entry (or entries) will include a debit to: 
A. Appropriations
B. Interfund Transfers In
C. Interest Expense
D. Expenditures—Bond Interest

Which of the following may properly be reported as a component of net assets in the proprietary fund statement of net assets?
A. Restricted net assets
B. Contributed capital
C. Retained earnings
D. Designated equity

Revenue items such a property taxes, fines, sales tax are reported using:
A. Governmental Fund Accounting
B. Just the governmental funds, do not consider the proprietary or fiduciary funds
C. Government-Wide Accounting 
D. Both Governmental Fund Accounting and Government-Wide Accounting
E. Neither Governmental Fund Accounting nor Government-Wide Accounting

Which of the following would increase the balance in net assets—invested in capital assets, net of related debt?
A. Acquisition of a building to be used by the police department
B. Recording annual depreciation on capital assets
C. A gift of land to the city restricted by the donor to be used by the city airport, which is accounted for as an enterprise fund
D. Issuance of long-term debt to be used to acquire equipment for the police department

Transactions for capital assets can be found in:
A. The fund financial statements
B. The government-wide financial statements
C. Both the fund financial statements and the government-wide financial statements

Which of the following funds of a government uses the modified accrual basis of accounting:
A. All funds can use the modified approach
B. Enterprise
C. Internal service
D. Private-purpose trust fund
E. General fund

Which of the following circumstances would indicate that a potential component unit (PCU) should be included as part of the governmental financial reporting entity?
A. Officials of the primary government appoint a majority of the members of the governing board of the PCU
B. The PCU has sufficient operational and financial dependence that the primary government can impose its will on the PCU
C. The primary government does not approve the operating budget of the potential component unit
D. Officials of the primary government appoint a majority of the members of the PCU's governing board and the primary government is able to impose its will on the PCU

Reporting on asset preservation is related to:
A. Fiduciary funds
B. Debt covenants for bonds used to acquire fixed assets 
C. The modified approach
D. Utility accounting
E. All capital assets

When the budget is recorded for a city for the sale of the bonds:
A. #1 no entries are required on the debt service fund
B. #2 there will be a credit to estimated revenues
C. #3 there will be a debit to estimated other financing sources
D. #1 and #2 are correct
E. Both #1 and #3 are correct

At year end in the governmental funds accounts: 
A. #1 the encumbrance accounts are closed
B. #2 the reserves for encumbrances are closed
C. #3 the interfund transfers are carried over to the next year
D. Both #1 and #2 are correct
E. #1 and #2 and #3 are all correct

If a government issues debt to finance capital acquisition by another government and the proceeds of the debt are a short time later delivered to the intended beneficiary government, how is the related long-term debt reflected in a governmental fund of the issuing government?
A. It is not displayed on the face of the financial statements; however, it is disclosed in the notes to the financial statements
B. Other financing source and other financing use
C. Revenue and expenditure
D. Other financing source and expenditure

The city of Columbus issued bonds at par for the construction of a new city office building. The receipt of the bond proceeds could result in journal entries in which funds under correct governmental accounting?
A. Capital Projects Fund: Yes; Debt Service Fund: Yes
B. Capital Projects Fund: No; Debt Service Fund: No
C. Capital Projects Fund: Yes; Debt Service Fund: No
D. Capital Projects Fund: No; Debt Service Fund: Yes

Which of the following resource inflows would be recorded as a revenue of a debt service fund?
A. Property taxes levied by the debt service fund for debt service purposes
B. Receipt of the premium on a new bond issue
C. Transfer of the residual equity of a capital project from a capital projects fund to the debt service fund
D. Taxes collected by the General Fund and transferred to the debt service fund

What journal entry should be made at the beginning of the fiscal year to reestablish the encumbrances account of a capital projects fund for a multi-year capital project?
A. Debit Encumbrances and credit Fund Balance
B. Debit Fund Balance and credit Encumbrances
C. Debit Encumbrances and credit Reserve for Encumbrances
D. Debit Reserve for Encumbrances and credit Encumbrances

Which of the following funds of a government uses the same basis of accounting as a proprietary fund?
A. Permanent trust
B. Capital projects
C. Special revenue
D. Investment trust fund

At the government-wide level, net assets related to capital assets should be reported as: a. Invested in capital assets, net of related debt
b. Restricted or unrestricted financial assets, as appropriate
c. General capital assets, preceding general long-term liabilities
d. Net equity in capital assets
e. None of the above are correct – this is just footnote disclosure

Under the modified accrual basis of accounting, revenues should be recognized when:
A. Authorized by the budget ordinance
B. Collected in cash
C. Earned
D. None of these
E. When earned and collected 

Aggregate view of the financial results is found in which of the following:
A. Governmental Fund Accounting
B. Just the governmental funds, do not consider the proprietary or fiduciary funds
C. Government-Wide Accounting
D. Both Governmental Fund Accounting and Government-Wide Accounting
d. Neither Governmental Fund Accounting nor Government-Wide Accounting

Which of the following best describes the recommended format for the government-wide statement of activities?
A. Program revenues minus expenses plus general revenues equals change in net assets
B. Program revenues plus general revenues minus expenses equals change in net assets
C. Expenses minus program revenues plus general revenues equals change in net assets
D. Program revenues minus expenses minus other revenues and expenses equals change in net assets

The account balance in the Reserve for Encumbrance account is normally a:
A. The normal balance can be either  a debit or a credit
B. Debit 
C. Credit

Equipment in general governmental service that had been acquired several years ago by a capital projects fund at a cost of $40,000 was sold for $15,000 cash. Accumulated depreciation of $30,000 existed at the time of the sale. The journal entry to be made in the governmental activities journal will include all of the following EXCEPT:
A. A credit to Other Financing Sources for $5,000
B. A debit to Accumulated Depreciation for $30,000
C. A credit to Equipment for $40,000
D. A debit to Cash for $15,000

Generally speaking, transactions for the special revenue fund and the general fund can be recorded in:
A. Governmental Fund Accounting
B. Just the governmental funds, do not consider the proprietary or fiduciary funds
C. Government-Wide Accounting 
D. Both Governmental Fund Accounting and Government-Wide Accounting
E. Neither Governmental Fund Accounting nor Government-Wide Accounting

The use of other financing uses and other financing sources is found in:
A. Governmental Fund Accounting. Just the governmental funds, do not consider the proprietary or fiduciary funds
B. Government-Wide Accounting
C. Both Governmental Fund Accounting and Government-Wide Accounting
D. Neither Governmental Fund Accounting nor Government-Wide Accounting

Which of the following is the appropriate basis of accounting for an agency fund?
A. Modified cash basis
B. Accrual basis
C. Modified accrual basis
D. Cash basis

Transactions for encumbrances capital assets can be found in:
A. The fund financial statements
B. The government-wide financial statements
C. Both the fund financial statements and the government-wide financial statements

Other financing sources and uses are:
A. Found in the government-wide financial statements
B. Accounted for with cash basis accounting
C. Found in the governmental fund financial statements

An internal allocation of funds done on a periodic basis to prevent overspending in the early part of the budget period is called a(an):
A. Allocation
B. Periodic appropriation
C. Appropriation
D. Allotment
E. None of the above

Which of the following funds should be used if resources provided by a federal grant must be segregated and used for counseling of youthful offenders?
A. General fund
B. All of these are correct
C. Internal service fund
D. Private-purpose trust fund
E. Special revenue fund

Which of the following terms indicate or relate to the idea of a separate government or agency that is combined for the purposes of the whole entity?
A. Discrete presentation
B. Fund equity
C. Reporting entity
D. Modified accrual basis
E. Component unit

Which of the following would be classified as a general revenue?
A. Library fines
B. Fuel taxes earmarked for maintenance of roads and bridges
C. Special assessment charges for snow removal
D. Parking meter fees
E. All of these can be classified as general revenue

Which of the following is not a budgetary account?
A. All are budgetary accounts
B. Reserve for Encumbrances
C. Appropriations
D. Estimated Revenues
E. Encumbrances

When the budget for the General Fund is recorded , the required journal entry will include:
A. A credit to Estimated Revenues
B. A credit to Appropriations
C. A debit to Encumbrances
D. A credit to Budgetary Fund Balance
E. Three of these answers are correct

Which of the following accounts of a government is credited when a purchase order is approved?
A. Appropriations
B. Reserve for Encumbrances or Encumbrances Outstanding
C. Vouchers Payable
D. Cash
E. Encumbrances

The Expenditures control account of a government is debited when:
A. Supplies previously encumbered are received
B. Supplies are ordered
C. The budget is recorded
D. The invoice is paid

Fiscal accountability includes:
A. Whether or not the government as raised and spent funds in accordance with an approved budget
B. Compliance with laws and regulations
C. Operational efficiency
D. Both whether or not the government has raised and spent funds in accordance with an approved budget and compliance with laws and regulations
E. Whether or not the government has raised and spent funds in accordance with an approved budget and compliance with laws and regulations and operational efficiency

The measurement focus and basis of accounting of special revenue funds are most similar to:
A. FASB accounting
B. GASB accounting
C. Cash basis accounting
D. Both the General Fund and the Permanent Fund
E. None of the answers are correct

Which of the following steps in the acquisition of goods and services by an activity accounted for by the General Fund occurs first?
A. Disbursement
B. Expenditure
C. Expense
D. Encumbrance
E. Appropriation

Program revenues:
A. Can be from exchange or non-exchange transactions
B. Are linked to a specific function or program and are not included in general revenue in either the government-wide financial statements or in the fund financial statements
C. Are linked to a specific function or program and are included in the government-wide financial statements
D. All of these characterize program revenue
E. Are usually in the form of a tax

A tax is assessed to each parcel of property to fund a new park as a result of a recent election. these funds would be most properly accounted by:
A. A permanent fund
B. None of these funds
C. A special revenue fund
D. The general fund
E. A trust fund

Long-term assets like vehicles would be accounted for with:
A. The current financial resources focus
B. Fiscal accountability
C. Economic resources focus
D. Both the current financial resources focus and fiscal accountability
E. All of these would be used to account for long-term assets

The Permanent Fund is used for:
A. All trust funds
B. Only short-term sinking funds
C. Public-purpose trust funds
D. Holding funds for investments only
E. None of the above

When another fund pays the General Fund an amount in lieu of taxes, the account to be credited in the General Fund is:
A. Cash
B. Operating Transfer In
C. Revenues
D. Fund Balance
E. None of the above are correct

Which of the following should not be reported as a liability of the General Fund?
A. Vouchers payable
B. General obligation bonds payable (due in 10 years)
C. Due to federal government
D. Tax anticipation notes payable

Property tax revenue is recognized differently from sales tax revenue in fund accounting because:
A. Property tax revenue can be estimated but sales tax revenue cannot be estimated
B. There is a legally enforceable claim for property tax revenue
C. It is a derived revenue

When the budget of a government is adopted and Estimated Revenues exceeds Appropriations, the excess is:
A. Debited to Budgetary Fund Balance
B. Credited to Budgetary Fund Balance
C. Credited to Reserve for Encumbrances
D. Debited to Reserve for Encumbrances

Which of the following is one of the three sections of a comprehensive annual financial report (CAFR)?
A. Supplementary section
B. Investment section
C. Single audit section
D. Statistical section

Which of the following items are typically reported differently between the Governmental Fund statements and the Governmental Activities column of the government-wide statements?
A. Accounts payable and other accrued expenses
B. Inventories
C. Cash collected on property taxes receivable
D. Capital outlays

Operational accountability for general capital assets funded by tax receipts of a government should be established in:
A. The capital projects fund
B. The appropriate governmental funds
C. The governmental activities accounts at the government-wide level

When materials that were ordered for a capital projects fund for use on a construction project are received but the invoice has not yet paid, what account is debited?
A. Encumbrances
B. Vouchers payable
C. Appropriations
D. Construction Expenditures

The term that is closely related to the concept of liquidity is:
A. Financial condition
B. Economic condition
C. Interperiod equity
D. Financial position

Which of the following is not true?
A. Debt service funds, unlike the General Fund and special revenue funds, do not use budgetary accounting procedures
B. Expenditures for interest on tax supported long-term debt are not accrued even though best service funds are accounted for on the modified accrual basis
C. At year-end, budgetary and operating statement accounts of a debt service fund are closed in the same manner as is true for a General Fund or special revenue funds
D. The debt service activity of a government may be properly accounted for within the General Fund unless law mandates the use of a debt device fund

Which of the following accounts is least likely to be used by a tax agency fund?
A. Due to other funds and units
B. Cash
C. Revenues
D. Taxes receivable for other funds and units

When bonds are sold, there will be a:
A. A debit to cash in the general fund accounts
B. A credit to other financing uses
C. Debit to cash in the debt service fund accounts

Infrastructure assets and long-term liabilities issued to finance infrastructure should be reported in the:
A. Management's discussion and analysis
B. Government-wide financial statements
C. Fund financial statements
D. Letter of transmittal

An internal service fund normally uses which of the following budgetary accounts?
A. Appropriations
B. Encumbrances
C. Estimated Revenue
D. None of these are correct

One of the accounting entries made at the start of the year is to:
A. #3 close out the reserve for encumbrances
B. #2 reestablish the unexpended encumbrances with a debit entry
C. #1 reestablish the unexpended encumbrances with a credit entry

Which of the following resource inflows would be recorded as a revenue of a debt service fund?
A. Property taxes levied by the debt service fund for debt service purposes
B. Taxes collected by the General Fund and transferred to the debt service fund
C. Transfer of the residual equity of a capital project from a capital projects fund to the debt service fund

A term that describes a government's ongoing ability and willingness to raise revenues, incur debt, and meet its financial obligations as they become due is:
A. Economic condition
B. Financial condition
C. Fiscal capacity
D. Financial position

Which of the following is the most reliable means of distinguishing a trust relationship from an agency relationship for purposes of deciding which type of fiduciary fund should be used?
A. Examine the working of any agreements to determine if the word "trust" or "agency" is used
B. Examine the length of time assets will be held, trust relationships are generally i existence longer than agency relationships
C. Examine the aggregate of factors, such as the enactment that brought the relationship into existence, statutes, regulations, etc., that help define the nature of the relationship
D. Examine the amount of money involved, agency relationships generally involve smaller amounts

Which of the following would be considered a general capital asset?
A. A vehicle purchased for the police department
B. All are general capital assets
C. A vehicle purchased and maintained by an enterprise fund
D. Real estate purchased with the assets of a pension trust fund
E. A computer for an internal service fund and used by the supplies department

Which of these fiduciary fund types always has zero net assets?
A. Investment trust funds
B. Agency funds
C. Private-purpose trust funds
D. All of these funds have zero net assets
E. Pension trust funds