3501 Final

60 Questions  I  By Xbzzle
Please take the quiz to rate it.

 3501 Final

  
Changes are done, please start the quiz.


Questions and Answers

Removing question excerpt is a premium feature

Upgrade and get a lot more done!
  • 1. 
    Enterprise funds sell goods and services to internal users only.
    • A. 

      True

    • B. 

      False


  • 2. 

     Proprietary funds use the economic resources measurement focus and accrual basis of accounting.
    • A. 

      True

    • B. 

      False


  • 3. 
    The budget is a master blueprint for planning, control and evaluation of financial operations.
    • A. 

      True

    • B. 

      False


  • 4. 

     Budgetary accounts include Estimated Revenues, Revenues, and Accounts Receivable.
    • A. 

      True

    • B. 

      False


  • 5. 
    Interfund transfers and debt issue proceeds received by the General Fund should be recorded as other financing sources.
    • A. 

      True

    • B. 

      False


  • 6. 
    An encumbrance represents the estimated future liability for goods or services resulting from placing a purchase order or signing a contract.
    • A. 

      True

    • B. 

      False


  • 7. 

     "Available appropriation" is calculated as the difference between appropriations and the sum of expenditures and encumbrances.
    • A. 

      True

    • B. 

      False


  • 8. 
    All purchases of goods and services and all interfund transfers of the General Fund are recorded as Expenditures.
    • A. 

      True

    • B. 

      False


  • 9. 
    Budgetary accounts used in the General Fund include Estimated Revenues, Estimated Other Financing Sources, Appropriations, Estimated Other Financing Uses, and Encumbrances.
    • A. 

      True

    • B. 

      False


  • 10. 

     A characteristic of government is that an exchange relationship exists between services received and resources provided.
    • A. 

      True

    • B. 

      False


  • 11. 

     The GAAP Hierarchy is issued by GASB.
    • A. 

      True

    • B. 

      False


  • 12. 

     FASB standards would be followed by a not-for-profit charitable organization
    • A. 

      True

    • B. 

      False


  • 13. 
    Governmental accounting methods were developed to completely control the budget.
    • A. 

      True

    • B. 

      False


  • 14. 

     GFOA is a standard-setting body.
    • A. 

      True

    • B. 

      False


  • 15. 
    The prime function of budgetary entries is to
    • A. 

      Facilitate the year-end budget-to-actual comparisons

    • B. 

      Amend the budget during the year

    • C. 

      Help the government monitor revenues and expenditures

    • D. 

      Apportion appropriated expenditures to specific accounts


  • 16. 
    A  government should debit an expenditure account upon
    • A. 

      Recording the budget

    • B. 

      Recording the receipt of an invoice from its telephone service provider

    • C. 

      Ordering supplies

    • D. 

      Approving an allocation of budget to a department for spending


  • 17. 
    One characteristic that distinguishes other financing sources from revenues is that other financing sources:
    • A. 

      Arise from debt issuances or interfund transfers in

    • B. 

      Increase fund balance when they are closed at year-end

    • C. 

      Have a normal credit balance

    • D. 

      Provide financial resources for the recipient fund


  • 18. 
    Under the modified accrual basis of accounting, expenditures generally are not recognized until:
    • A. 

      They are approved by the legislative body

    • B. 

      Goods or services are ordered

    • C. 

      They are paid in cash

    • D. 

      An obligation is incurred that will be paid from currently available resources


  • 19. 
    A police care was ordered and estimated to cost $22,000. The $22,000 estimate was recorded as an encumbrance. Upon receipt of the police car with an invoice for $21,000, the encumbrance account will:
    • A. 

      Be credited for $1,000

    • B. 

      Be credited for $22,000

    • C. 

      Not change

    • D. 

      Be debited for $21,000


  • 20. 
    What is a key difference between budgets prepared by governmental units and by commercial organizations?
    • A. 

      Operating, capital, and cash budgets are prepared by governmental units, but only operating budgets are prepared by commercial organizations.

    • B. 

      Budgets prepared by commercial organizations must be approved by a governing body, whereas those prepared by governmental units need no approvals.

    • C. 

      Budgets prepared by governmental units are legal documents, whereas those prepared by commercial organizations are not.

    • D. 

      Budgets prepared by commercial organizations are formally recorded in the organizations operating accounts, whereas those prepared by governmental units are not.


  • 21. 
    Which of the following is not included in a cash budget?
    • A. 

      Redemption of bonds

    • B. 

      Depreciation

    • C. 

      Personal services

    • D. 

      Utilities


  • 22. 
    At the time a government levies the property tax, an allowance for uncollectible property taxes is established so that
    • A. 

      Probable delinquent taxpayers can be identified individually

    • B. 

      Property tax receivables are carried at net realizable value

    • C. 

      An expenditure for bad debts is recorded in the accounts

    • D. 

      Property tax revenues will exceed the total amount of the levy


  • 23. 
    A municipality uses the allowance method to record uncollectible property taxes. If it decides to write off an account as uncollectible, it should:
    • A. 

      Debit bad debts expenditures; credit allowance for uncollectible property taxes

    • B. 

      Debit allowance for uncollectible property taxes; credit property taxes receivable

    • C. 

      Debit allowance for uncollectible property taxes; credit property tax revenues

    • D. 

      Debit property tax revenues; credit property taxes receivable


  • 24. 
    Which of the following revenues of the General Fund are usually recorded before they are actually received in cash?
    • A. 

      Property taxes

    • B. 

      Parking meter receipts

    • C. 

      Fines and penalties

    • D. 

      License and permit fees


  • 25. 
    The purchase of office supplies on the purchases method would result in:
    • A. 

      A debit to office supplies inventory

    • B. 

      A credit to office supplies expenditure

    • C. 

      A debit to office supplies expenditure


  • 26. 
    The purchase of office supplies on the consumption method would result in:
    • A. 

      A debit to office supplies inventory

    • B. 

      A credit to office supplies expenditure

    • C. 

      A debit to expenditure

    • D. 

      Credit to expenditures


  • 27. 
    If the City of Castletown sells a surplus ambulance, the entry to record this sale on the books of the General Fund should include which of the following?
    • A. 

      A credit to Other financing sources proceeds from sale of general fixed assets

    • B. 

      A credit to a Vehicles fixed asset acc

    • C. 

      A debit to Unreserved fund balance ount

    • D. 

      A debit to Encumbrances capital equipment


  • 28. 
    The budget of the General Fund of the City of Olde Glen shows an ap-propriation for capital equipment of $ 150,000. So far a fire engine, cost-ing $ 50,000, has been received and paid for. Another fire engine, expected to cost $ 60,000, has been ordered and an encumbrance for this amount is outstanding. How much can the city legally spend for a third fire engine this year?
    • A. 

      0

    • B. 

      $ 100,000

    • C. 

      $ 40,000

    • D. 

      $ 90,000


  • 29. 
    Encumbrance accounting usually ( is or is not) ________ used in Capital Projects Funds.
    • A. 

      Is

    • B. 

      Is not


  • 30. 
    Long- term bonds issued by a Capital Projects Fund ( are or are not) __________ reported as a liability of that fund.
    • A. 

      Are

    • B. 

      Are not


  • 31. 
    What is done with resources that remain in a Capital Projects Fund after the project is completed?
    • A. 

      Always returned to the provider( s) of the resources

    • B. 

      Always transferred to a Debt Service Fund

    • C. 

      Disbursed according to the directives of the resource provider

    • D. 

      Always transferred to the General Fund


  • 32. 
    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 amount of money involved; agency relationships generally involve smaller amounts.

    • B. 

      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.

    • C. 

      Examine the length of time assets will be held; trust relationships are generally in existence longer than agency relationships.

    • D. 

      Examine the wording of any agreements to determine if the word "trust" or "agency" is used.


  • 33. 
    In what way can the amounts in an Investment Trust Fund be invested?
    • A. 

      Only in corporate stocks and bonds

    • B. 

      Only in governmental bonds

    • C. 

      Only as provided in the trust agreement

    • D. 

      Any way the government that operates the fund wishes


  • 34. 
    How are proceeds on the sale of an investment in excess of its book value handled in a Private Purpose Trust Fund?
    • A. 

      May be debited to the assets or an additions account

    • B. 

      May be debited or credited to the asset account

    • C. 

      Must be credited to an additions account

    • D. 

      May be credited to the asset account


  • 35. 
    For which of the following activities might an Agency Fund be used?
    • A. 

      None of the these

    • B. 

      Debt service of general obligation bonds used to finance an addition to city hall

    • C. 

      Revenue generated from a property tax levy

    • D. 

      Expenditures of the General Fund

    • E. 

      Debt service for Enterprise Fund debt


  • 36. 
    Which of the following funds can be used to account for the spendable in-come from a Private Purpose Trust Fund?
    • A. 

      None of the these

    • B. 

      Capital Projects Fund

    • C. 

      Pension Trust Fund

    • D. 

      General Fund

    • E. 

      Agency Fund


  • 37. 
    The minimum requirements for general purpose external financial reporting are (1) management's discussion and analysis (MD&A), (2) the basic financial statements, including the notes to the financial statements, and (3) combining and individual fund financial statements.
    • A. 

      True

    • B. 

      False


  • 38. 
    A financial reporting entity is defined as a primary government, as well as all other organizations that have an operational relationship with the primary government.
    • A. 

      True

    • B. 

      False


  • 39. 
    A component unit is dependent on the primary government if the primary government is obligated for its debt.
    • A. 

      True

    • B. 

      False


  • 40. 
    The GASB Statement No. 34 financial reporting model does not include fund financial statements.
    • A. 

      True

    • B. 

      False


  • 41. 
    The Management's Discussion and Analysis section of the financial report includes projections about future fund balances for the next fiscal year.
    • A. 

      True

    • B. 

      False


  • 42. 
    A comprehensive annual financial report (CAFR) prepared in conformity with GASB recommendations should include which of the following sections?
    • A. 

      Letter of transmittal, MD&A, and financial.

    • B. 

      Introductory, financial, and statistical.

    • C. 

      Introductory, MD&A, and financial.

    • D. 

      Letter of transmittal, financial, and supplementary.


  • 43. 
    The section of the comprehensive annual financial report that presents tables and charts showing social and economic data in addition to financial trends, fiscal capacity, and operating information of the government is the:
    • A. 

      Introductory section.

    • B. 

      Management discussion and analysis section.

    • C. 

      Statistical section.

    • D. 

      Financial section.


  • 44. 
    Which of the following information should be included in the financial section of a comprehensive annual financial report?
    • A. 

      Transmittal letter.

    • B. 

      The basic financial statements, including notes thereto.

    • C. 

      Tables and charts showing demographic and economic data.

    • D. 

      A description of the government.


  • 45. 
    The fund financial statements for governmental funds should include a
    • A. 

      Statement of cash flows.

    • B. 

      Statement of revenues, expenses, and changes in fund net assets.

    • C. 

      Balance sheet.

    • D. 

      Statement of activities.


  • 46. 
    In governmental financial reporting, what is blending?
    • A. 

      A method of preparing the notes to the CAFR

    • B. 

      The process of including the financial data of a component unit with the financial data of the primary government

    • C. 

      The process of combining intergovernmental revenues with the revenues of the reporting government

    • D. 

      The process of reporting the financial data of a component unit as a sep-arate column in the reporting entitys financial statements


  • 47. 
    From the following, select the two conditions that, taken together, will cause an entity to be reported as a component unit of a primary government:
    • A. 

      The primary government is required by law to finance the entity's deficits. .

    • B. 

      The primary government is authorized by law to bill the entity the cost of police and fire protection

    • C. 

      The primary governments chief executive can appoint a voting majority of the entity 's governing body.

    • D. 

      The primary governments director of finance serves as a member of the entity' s governing body.

    • E. 

      The primary government is required by law to purchase its electricity from the entity,which also supplies electricity to the residents of the community.


  • 48. 
    Thomas Village operates on a calendar-year basis. On January 1,2009,it had outstanding property taxes receivable of $ 40,000 and deferred property tax revenue of $ 10,000. On January 1,2009,it levied property taxes of $ 1,000,000 to cover its 2009 activities. During 2009,it collected the entire$ 40,000 $40,000 of receivables that were outstanding as of January 1,as well as $ 975,000 against the 2009 levy. With regard to the uncollected 2009 taxes,the village expected to collect $ 20,000 during the first 60 days of 2010 and the remaining $ 5,000 during the rest of 2010. How much should Thomas Village recognize as property tax revenues in its General Fund for calendar year 2009?
    • A. 

      $ 995,000

    • B. 

      $ 1,000,000

    • C. 

      $ 1,015,000

    • D. 

      $ 1,005,000


  • 49. 
    The governmental fund financial statements are intended to report on fiscalaccountability.
    • A. 

      True

    • B. 

      False


  • 50. 
    Which measurement focus should be used in government-wide financial statements?
    • A. 

      The same measurement focus as that used in accounting for each fund type

    • B. 

      The current financial resources measurement focus

    • C. 

      The economic resources measurement focus

    • D. 

      The economic resources measurement focus for governmental fund types and the current financial resource measurement focus for proprietary and fiduciary fund types


  • 51. 
    How should the difference between assets and liabilities be characterized in government-wide financial statements?
    • A. 

      As fund balances

    • B. 

      As fund equity

    • C. 

      As net assets

    • D. 

      As available for spending


  • 52. 
    How should component units be displayed in government-wide financial statements?
    • A. 

      Component units should not be reported in government-wide financial statements

    • B. 

      All component units should be included either in the column for governmental activities or in the column for business-type activities

    • C. 

      Component units should be blended where appropriate;discretelypresented component units should be reported in a separate column

    • D. 

      All component units should be included with other business-type activities


  • 53. 
    The General Fund makes a transfer to the Debt Service Fund. How should the transfer be reported in the financial statements?
    • A. 

      The transfers in and out should be reported in the government-wide operating statement,but not in the fund operating statement.

    • B. 

      The transfers in and out should be reported in neither the fund operating statement nor the government- wide operating statement.

    • C. 

      The transfers in and out should be reported in the fund operating statement,but not in the government- wide operating statement.

    • D. 

      The transfers in and out should be reported in both the fund operating statement and the government-wide operating statement.


  • 54. 
    A village issues $ 3,000,000 of general obligation bonds to build a new fire-house. How should the debt be reported?
    • A. 

      As a liability in the fund balance sheet

    • B. 

      As a liability in both the fund balance sheet and the government- wide statement of net assets

    • C. 

      As a liability in the government- wide statement of net assets

    • D. 

      As proceeds of debt in the government- wide statement of activities


  • 55. 
    A village levies property taxes in the amount of $ 1,260,000 for the fiscal year ended June 30,2009. It collects $ 1,200,000 during the year. Regarding the $ 60,000 of delinquent receivables,it expects to collect $ 25,000 in July and August of 2009 and another $ 20,000 after August but before March of 2010. It expects to write off $ 15,000 as uncollectible. How much should the village recognize as property tax revenue in its government- wide statement of activities for the fiscal year ended June 30,2009?
    • A. 

      $ 1,225,000

    • B. 

      $ 1,260,000

    • C. 

      $ 1,200,000

    • D. 

      $ 1,245,000


  • 56. 
    Which of the following statements concerning deriving government-wide financial statement is true?
    • A. 

      Net Assets does not reflect spendable equity

    • B. 

      Adjustments made to convert governmental funds to governmental activities are posted to the general ledger

    • C. 

      The worksheet approach to deriving government-wide financial statements is required by GAAP

    • D. 

      All of these are false


  • 57. 
    If Parnell Parish has two major governmental funds,to major Enterprise Funds,three fiduciary funds and two discrete component units,what would be the minimum number of columns reported in its government-wide Statement of Net Assets?
    • A. 

      Two

    • B. 

      Three

    • C. 

      Four

    • D. 

      Five

    • E. 

      Seven

    • F. 

      Eight


  • 58. 
    When should property tax revenues be recognized in government-wide financial statements?
    • A. 

      In the period for which the taxes are levied (net of estimated refunds and uncollectibles), provided they are measurable and available

    • B. 

      In the period for which the taxes are levied (net of estimated refunds and uncollectibles), even if the enforceable legal claim arises or due date for payment is in a different period

    • C. 

      In the period they are collected in cash, together with an accrual for uncollected taxes

    • D. 

      In the period when an enforceable legal claim arises or when the resources are received, whichever occurs first


  • 59. 
    On July 1, 2008, a city used tax resources of $70,000 to acquire three police cruisers. The police cars were expected to have a useful life of three years, after which the salvage value would be $10,000. Describe the adjustment or adjustments needed to prepare government-wide financial statements from the city's calendar year 2008 fund-level financial statements
    • A. 

      Record capital assets, and record six months' depreciation ($11,667)

    • B. 

      Record capital assets, reduce capital outlay expenditures, and record six months' depreciation ($10,000)

    • C. 

      Record capital assets, reduce capital outlay expenditures, and record six months' depreciation ($11,667)

    • D. 

      No adjustments are needed


  • 60. 
    What constitutes the basic financial statements of a government?
    • A. 

      Financial section of the comprehensive annual financial report (CAFR).

    • B. 

      Government-wide financial statements plus notes.

    • C. 

      Government-wide financial statements plus fund financial statements plus notes.

    • D. 

      Government-wide financial statements plus fund financial statements plus notes plus required supplementary information (RSI).


Back to top

Removing ad is a premium feature

Upgrade and get a lot more done!
Take Another Quiz
We have sent an email with your new password.