Which of the following is common both to governmental AND business entities?
Importance of accurate financial reporting.
Resource providers that do not expect benefits proportional to the resources provided.
Absence of profit motive.
Absence of a defined ownership interest that can be sold, transferred, or redeemed.
Corresponds to CLO 1(b) Which of the following groups normally would be considered primary users of a state or local government's general purpose external financial statements?
Potential commercial interests.
Current and potential creditors.
B and C.
Corresponds to CLO 1(c) The Governmental Accounting Standards Board (GASB) has the responsibility for setting accounting and financial reporting standards for
Governments including federal agencies, states, cities, counties, villages, and townships.
State and local government entities and governmental not-for-profit organizations.
All of the above.
Corresponds to CLO 1(d)
Which of the following would be considered a governmental organization?
A museum associated with a private university
An elementary school district
A private trust organized for charitable purposes
Corresponds to CLO 2(a) What is included in the basic financial statements of a government?
The entire financial section of the comprehensive annual financial report.
Government-wide financial statements and notes.
Government-wide financial statements, fund financial statements and notes.
Government-wide financial statements and fund financial statements and notes and required supplementary information.
Corresponds to CLO 2(b) Which of the following is one of the three sections recommended by GASB for inclusion in the Comprehensive Annual Financial Report (CAFR)?
Government-wide financial section.
Popular reporting section.
Fund statement section.
Corresponds to CLO 2(c) How should financial information for internal service funds be reported in the government-wide financial statements?
As part of governmental activities.
As part of business-type activities.
Amounts allocated proportionately between governmental and business-type activities.
Usually as part of governmental activities, unless the internal service fund predominantly serves one or more enterprise funds.
Corresponds to CLO 2(d) Which of the following financial statements would not be reported anywhere in the fund financial statements?
Statement of net assets.
Statement of cash flows.
All of the above could be reported within the fund financial statements.
Corresponds to CLO 3(a)
The resource inflows and the funds that they are most likely to be recorded in are:
Bond proceeds in the debt service funds, fines and forfeits in general fund, sales taxes in the internal service funds,
Sales taxes in the general fund, proceeds of bonds in the capital projects funds, utility charges for services in the enterprise funds and investment earnings in the permanent funds
Charges for services in the proprietary funds, investment earnings in internal service funds, and proceeds of bonds in the governmental funds.
Sales taxes in the general fund, proceeds of bonds in the debt service funds, utility charges for services in the internal service funds and investment earnings in the permanent funds
Corresponds to CLO 3(b)
A city's General Fund general ledger includes accounts called Encumbrances and Outstanding Encumbrances. This indicates that the city
Uses encumbrance accounting to better manage appropriations.
Uses a cash plus encumbrances basis of accounting.
Maintains its accounts on an accrual basis.
Reports encumbrances as expenditures in budget vs actual reporting.
Corresponds to CLO 3(c)
How should a governmental unit report a general capital asset resulting from a construction project that was accounted for in a capital projects fund?
In the asset section of the governmental funds balance sheet.
In the governmental activities column in the government-wide statement of net assets.
In the general fixed assets account group.
In the asset section of the proprietary funds statement of net assets.
Corresponds to CLO 3(d)
Government-wide financial statements
Display individual funds.
Display aggregated information about fund types.
Exclude information about discretely presented component units.
Use separate columns to distinguish between governmental and business-type activities.
Corresponds to CLO 4(a)
The journal entry in the debt service fund to record the transfer from the general fund to pay principal and interest on general long term obligations is
Debit Cash and Credit Revenues
Debit Cash and Credit Bonds payable
Debit Cash and Credit Fund balance
Debit Cash and Credit Other financing sources
Corresponds to CLO 4(b)
The modified accrual basis of accounting applicable to governmental fund types requires that revenues be recognized when
Authorized by the budget ordinance.
Collected in cash.
Measurable and available
Corresponds to CLO 4(b) The following items were among WoodTownship's expenditures from the general fund during the year ended June 30:
Furniture for Township Hall $10,000
Minicomputer for tax collector's office 15,000
The amount that should be classified as general capital assets in Wood's general fund balance sheet at June 30 is
Corresponds to CLO 4(d) The primary emphasis in accounting and reporting for governmental funds is on
Flow of financial resources.
Transfers relating to proprietary activities.
Corresponds to CLO 5(a) Which of the statements regarding the accounting for encumbrances is false?
The entry to record an encumbrance would be a CREDIT to Encumbrances and a DEBIT to Reserve for Encumbrances.
The entry to record an encumbrance would be a DEBIT to Encumbrances and a CREDIT to Reserve for Encumbrances.
If the actual cost of a purchase exceeds the amount of the original encumbrance, the original encumbrance is still reversed at the original amount.
The recording of an encumbrance is intended to show that a portion of appropriations has been committed.
Corresponds to CLO 5(b) For the budgetary year ending December 31, MapleCity's general fund expects the following inflows of resources:
Property taxes, licenses, and fines $9,000,000
Proceeds of debt issue 5,000,000
Interfund transfers for debt service 1,000,000
In the budgetary entry, what amount should Maple record for estimated revenues?
Corresponds to CLO 5(c) In the current year, New City issued purchase orders and contracts of $850,000 that were chargeable against the current year's budgeted appropriations of $1,000,000. The journal entry to record the issuance of the purchase orders and contracts should include a
Credit to vouchers payable of $1,000,000.
Debit to encumbrances of $850,000.
Debit to expenditures of $1,000,000.
Credit to appropriations of $850,000.
Corresponds to CLO 5(d)
In the governmental funds fund financial statements, the operating accounts of the General Fund are classified as:
Operating revenues, Operating expenses, Nonoperating eevenues and expenses
Revenues, Expenditures, Other Financing Sources and Uses
Resource inflows and Resource outflows
Expenses, Program revenues, and General Revenues.
Corresponds to CLO 6(a) A fund that is used to account for the financing of goods or services provided by one department or agency to other departments or agencies of the government, on a cost-reimbursement basis, is properly classified as a (an)
Private purpose fund.
Internal service fund.
Special Revenue Fund.
Corresponds to CLO 6(b) A citizen contributed $500,000 to the City with the requirement that the money be invested and that only the earnings should be used for maintenance of the City's Central Park. The $500,000 would most appropriately be accounted for in a (an)
Private-purpose trust fund.
Corresponds to CLO 6(c) In Year 1, MentonCity received $5,000,000 of bond proceeds to be used for capital projects. Of this amount, $1,000,000 was expended in Year 1 with the balance expected to be incurred in Year 2. When should the bond proceeds be recorded in a capital projects fund?
$5,000,000 in Year 1.
$5,000,000 in Year 2.
$1,000,000 in Year 1 and $4,000,000 in Year 2.
$1,000,000 in Year 1 and in the general fund for $4,000,000 in Year 1.
Corresponds to CLO 6(d)
E A state or local government should report interfund transfers in a governmental fund as
Other financing sources or uses.
Items appearing after nonoperating revenues and expenses in the operating statement.
Revenues or expenditures.
Appropriations or liabilities.
Corresponds to CLO 7(a) Accounting standards for NPOs require
Modified accrual accounting.
Capitalization of collections.
Corresponds to CLO 7(b) A nongovernmental nonprofit organization, in order to conform to generally accepted accounting principles (GAAP), displays the changes in all classes of net assets on the
Statement of Cash Flows.
Statement of Financial Position.
Statement of Activities.
Statement of Functional Expenses.
Corresponds to CLO 7(c) Temporarily restricted net assets are released from restrictions
At the end of each fiscal year.
When money is spent for the purposes intended by the donor.
When funds are returned to the donor.
When they are converted to permanently restricted net assets.
Corresponds to CLO 7(d)
Which of the following kinds of volunteer service is most likely to be reported by a private hospital as contribution revenue and an expense?
Community members who plant flowers on the grounds once a year in the spring.
Volunteers in the gift shop who work a few hours a day serving customers.
Doctors who volunteer to provide medical care to homeless children.
An accountant who is a member of the board of directors.