Acct 6343.01 Accounting For Governmental & Not-for-profit Entities

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| By JIJohnson

JIJohnson

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Quizzes Created: 4 | Total Attempts: 7,016

Questions: 5 | Attempts: 1,053 | Updated: Mar 22, 2022

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The accounting midterm exam is coming up and as promised these quiz consists of the first five true or false questions you will be expected to answer on 19/3/2918. Give them a try and continue with your revision for the midterms. Remember to remind your friends to do the same.

Questions and Answers

1.

The accounting standard setting authority for the federal government is the Governmental Accounting Standards Board (GASB).
- A.
  
  True
- B.
  
  False
Correct Answer
B. False

Explanation
FASAB, the Federal Accounting Standards Advisory Board, is the primary standard setting authority for the federal government.

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2.

For most governmental entities, there is typically more than one general fund.
- A.
  
  True
- B.
  
  False
Correct Answer
B. False

Explanation
There can be only 1 general fund for each governmental entity, regardless of its size.

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3.

The fund that accounts for financial resources provided by revenue sources that are legally restricted to a specific purpose, other than capital projects or debt service, is the special revenue fund.
- A.
  
  True
- B.
  
  False
Correct Answer
A. True

Explanation
The special revenue fund is a type of fund that is used to account for financial resources that are legally restricted to a specific purpose, other than capital projects or debt service. This means that the revenue sources for this fund are designated for a particular use and cannot be used for other purposes. Therefore, the statement that the special revenue fund accounts for financial resources provided by revenue sources that are legally restricted to a specific purpose is true.

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4.

One difference between accounting for commercial businesses and accounting in the governmental/nonprofit environment is that the generation of net income is no longer a primary objective.
- A.
  
  True
- B.
  
  False
Correct Answer
A. True

Explanation
In the governmental/nonprofit environment, the primary objective is not to generate net income but to provide services or meet specific goals for the public or community. Unlike commercial businesses, which focus on profitability and maximizing net income, governmental/nonprofit entities prioritize the delivery of public services and achieving their missions. The financial statements and accounting practices in this sector reflect this difference in objectives, with emphasis on accountability, transparency, and stewardship of public resources rather than profit generation.

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5.

A "major" governmental fund is one with 10% of total assets, liabilities, revenues, or expenditures in the governmental funds category and 5% in the governmental and enterprise funds combined.
- A.
  
  True
- B.
  
  False
Correct Answer
A. True

Explanation
A "major" governmental fund is determined based on the percentage of total assets, liabilities, revenues, or expenditures in the governmental funds category, as well as the percentage in the governmental and enterprise funds combined. According to the given statement, a "major" governmental fund is one that has 10% of total assets, liabilities, revenues, or expenditures in the governmental funds category and 5% in the governmental and enterprise funds combined. Therefore, the statement is true.

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Current Version
Mar 22, 2022

Quiz Edited by
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Feb 14, 2008

Quiz Created by
JIJohnson

Acct 6343.01 Accounting For Governmental & Not-for-profit Entities

The accounting standard setting authority for the federal government is the Governmental Accounting Standards Board (GASB).

For most governmental entities, there is typically more than one general fund.

The fund that accounts for financial resources provided by revenue sources that are legally restricted to a specific purpose, other than capital projects or debt service, is the special revenue fund.

One difference between accounting for commercial businesses and accounting in the governmental/nonprofit environment is that the generation of net income is no longer a primary objective.

A "major" governmental fund is one with 10% of total assets, liabilities, revenues, or expenditures in the governmental funds category and 5% in the governmental and enterprise funds combined.