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One of the differences between accounting for a governmental (not-for-profit) unit and a commercial (for-profit) enterprise is that a governmental unit should:
A. 
Not record depreciation expense in any of its funds
B. 
Always establish and maintain complete self-balancing accounts for each fund
C. 
Use only the cash basis of accounting
D. 
Use only the modified accrual basis of accounting
Correct Answer B. Always establish and maintain complete self-balancing accounts for each fund
Explanation They use both cash and modified accrual basis of accounting.
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2.
Belle Valley incurred $100,000 of salaries and wages for the month ended March 31, 20X2. How should this be recorded on that date?
A. 
DR: Expenditures-Salaries and Wages 100,000; CR: Vouchers Payable 100,000
B. 
DR: Salaries and Wages Expense 100,000; CR: Vouchers Payable 100,000
C. 
DR: Encumbrances-Salaries and Wages 100,000; CR: Vouchers Payable 100,000
D. 
DR: Fund Balances 100,000; CR: Vouchers Payable 100,000
Correct Answer A. DR: Expenditures-Salaries and Wages 100,000; CR: Vouchers Payable 100,000
Explanation The correct answer is DR: Expenditures-Salaries and Wages 100,000; CR: Vouchers Payable 100,000. This is because when Belle Valley incurs salaries and wages expenses, it should be recorded as an expenditure in the Expenditures-Salaries and Wages account. At the same time, since the payment is not made immediately, it should be recorded as a liability in the Vouchers Payable account.
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3.
Which of the following expenditures is normally recorded on the accrual basis in the general fund?
A. 
Interest
B. 
Personal services
C. 
Inventory items
D. 
Prepaid expenses
Correct Answer B. Personal services
Explanation Personal services are normally recorded on the accrual basis in the general fund. This means that the expenses related to personal services, such as salaries and wages, are recognized when they are earned, regardless of when the payment is made. This allows for a more accurate representation of the financial position and performance of the general fund, as it matches the expenses with the period in which they are incurred. Interest, inventory items, and prepaid expenses, on the other hand, are typically recorded on a cash basis in the general fund.
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4.
Which of the following accounts of a governmental unit is credited when taxpayers are billed for property taxes?
A. 
Estimated Revenue
B. 
Revenue
C. 
Appropriations
D. 
Fund Balance-Assigned for Encumbrances
Correct Answer B. Revenue
Explanation When taxpayers are billed for property taxes, the account that is credited is Revenue. This is because property taxes are a source of income for the governmental unit. By crediting the Revenue account, the governmental unit records the increase in funds received from taxpayers as a result of property taxes.
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5.
Fixed assets purchased from general fund revenue were received. What account, if any, should have been debited in the general fund?
A. 
No journal entry should have been made in the general fund
B. 
Fixed assets
C. 
Expenditures
D. 
Fund Balance-Unassigned
Correct Answer C. Expenditures
Explanation When fixed assets are purchased from general fund revenue, the correct account that should have been debited in the general fund is "Expenditures." This is because fixed assets are considered as a type of expenditure for the general fund. By debiting the Expenditures account, it accurately reflects the decrease in the general fund's financial resources due to the purchase of fixed assets.
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6.
The initial transfer of cash from the general fund in order to establish an internal service fund would require the general fund to credit Cash and debit.
A. 
Accounts Receivable-Internal Service Fund
B. 
Transfers Out
C. 
Budgetary Fund Balance-Assigned for Encumberances
D. 
Expenditures
Correct Answer B. Transfers Out
Explanation When establishing an internal service fund, the general fund transfers cash to the internal service fund. This transfer is recorded by crediting the Cash account in the general fund, indicating a decrease in cash, and debiting the Transfers Out account in the general fund, indicating the transfer of funds to the internal service fund. This transaction does not involve Accounts Receivable-Internal Service Fund, Budgetary Fund Balance-Assigned for Encumbrances, or Expenditures accounts. Therefore, the correct answer is Transfers Out.
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7.
Which of the following steps in the acquisition of goods and services occurs first?
A. 
Appropriation
B. 
Encumbrance
C. 
Budget
D. 
Expenditure
Correct Answer C. Budget
Explanation The correct answer is "Budget." In the acquisition of goods and services, the first step is to create a budget. A budget is a financial plan that outlines the estimated expenses and revenues for a specific period. It helps to determine the amount of money available for purchasing goods and services. Once the budget is established, it provides guidance for subsequent steps such as appropriation, encumbrance, and expenditure. These steps involve allocating funds, reserving funds for specific purposes, and finally, making the actual payment for the goods and services.
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8.
What account is used to earmark the fund balance to recognize the contingent obligations of goods ordered but not yet received?
A. 
Appropriations
B. 
Encumbrances
C. 
Obligations
D. 
Fund Balance-Assigned for Encumbrances
Correct Answer D. Fund Balance-Assigned for Encumbrances
Explanation The account used to earmark the fund balance to recognize the contingent obligations of goods ordered but not yet received is Fund Balance-Assigned for Encumbrances. This account is specifically designated to set aside funds for encumbrances, which are commitments to pay for goods or services that have been ordered but not yet received. By assigning fund balance to encumbrances, organizations can ensure that they have enough funds available to fulfill these obligations when the goods are received.
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9.
When the Estimated Revenue Control account of a governmental unit is closed out at the end of the fiscal year, the excess of estimated revenues overestimated appropriations is
A. 
Debited to Fund Balance-Unassigned
B. 
Debited to Fund Balance-Assigned for Encumbrances
C. 
Debited to Budgetary Fund Balance-Unassigned
D. 
Credited to Fund Balance-Assigned for Encumbrances
Correct Answer C. Debited to Budgetary Fund Balance-Unassigned
Explanation When the Estimated Revenue Control account of a governmental unit is closed out at the end of the fiscal year, the excess of estimated revenues overestimated appropriations is debited to Budgetary Fund Balance-Unassigned. This is because the Budgetary Fund Balance-Unassigned account represents the unassigned portion of the fund balance, which includes any excess of revenues over appropriations. By debiting this account, the governmental unit is effectively transferring the excess funds to be used for future purposes or to cover any deficits in other accounts.
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10.
The Carson City general fund issued purchase orders of $630,000 to venders for supplies. Which of the following entries should be made to record this transaction?
A. 
DR: Encumbrances 630,000; Budgetary Fund Balance-Assigned for Encumbrances
DR: Budgetary Fund Balances 630,000; Encumbrances 630,000
Correct Answer A. DR: Encumbrances 630,000; Budgetary Fund Balance-Assigned for Encumbrances
Explanation The correct answer is DR: Encumbrances 630,000; Budgetary Fund Balance-Assigned for Encumbrances. This entry is made to record the issuance of purchase orders for supplies. Encumbrances are used to set aside funds for future expenses, and the Budgetary Fund Balance-Assigned for Encumbrances account is used to track the budgeted amount set aside for encumbrances. By debiting Encumbrances and the Budgetary Fund Balance-Assigned for Encumbrances, the transaction is properly recorded.
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11.
The following balances are included in the subsidiary records of Dogwood's Parks and Recreation Department on March 31, 20X2:
Appropriations-Supplies $7,500
Expenditures-Supplies 4,500
Encumbrances-Supply Orders 750
How much does the department have available for additional purchases of supplies?
A. 
$0
B. 
$2,250
C. 
$3,000
D. 
$6,750
Correct Answer B. $2,250
Explanation 7500-4500-750
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12.
The board of commissioners of the City of Elgin adopted its budget for the year ending July 31, 20x2, which indicated revenue of $1,000,000 and appropriations of $900,000. If the budget is formally integrated into the accounting records, what is the required journal entry?
A. 
Memorandum entry only
B. 
Appropriations Control 900,000
Budgetary Fund Balance-Unassigned 100,000
Estimated Revenues Control 1,000,000
C. 
Estimated Revenues Control 1,000,000
Appropriations Control 900,000
Budgetary Fund Balance-Unassigned 100,000
D. 
Revenue Receivable 1,000,000
Expenditures Payble 900,000
Budgetary Fund Balance-Unassigned 100,000
Correct Answer C. Estimated Revenues Control 1,000,000
Appropriations Control 900,000
Budgetary Fund Balance-Unassigned 100,000
Explanation The required journal entry is to record the budgeted revenue and appropriations in the accounting records. The estimated revenues control account is credited for the budgeted revenue of $1,000,000, and the appropriations control account is debited for the budgeted appropriations of $900,000. The budgetary fund balance-unassigned account is also debited for the excess of appropriations over revenue, which is $100,000. This entry ensures that the budgeted amounts are properly reflected in the accounting records and allows for tracking and control of the budgeted amounts.
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13.
Which of the following accounts of a governmental unit is credited when the budget is recorded?
A. 
Encumbrances
B. 
Budgetary Fund Balances-Assigned for Encumbrances
C. 
Estimated Revenue Control
D. 
Appropriations Control
Correct Answer D. Appropriations Control
Explanation Appropriations Control is credited when the budget is recorded for a governmental unit. This account is used to track the amount of money that has been set aside for specific purposes or projects. When the budget is recorded, the appropriations control account is credited to reflect the increase in the amount of money allocated for various expenses. This helps in ensuring that the government unit stays within its budgetary limits and can effectively manage its funds.
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14.
Which of the following accounts of a governmental unit is debited when supplies previously ordered are received?
A. 
Encumbrances
B. 
Budgetary Fund Balance-Assigned for Encumbrances
C. 
Vouchers Payable
D. 
Appropriations Control
Correct Answer B. Budgetary Fund Balance-Assigned for Encumbrances
Explanation 1.) Encumbrances
Budgetary Fund Balance-Assigned for Encumbrances
Purchase
2.) Budgetary Fund Balance-Assigned for Encumbrances
Encumbrances
3.) Expenditures
Vouchers Payable
4.) Vouchers Payable
Cash
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15.
Which of the following accounts of a governmental unit is credited to close it out at the end of the fiscal year?
A. 
Appropriations Control
B. 
Revenue-Property Tax
C. 
Budgetary Fund Balance-Assigned for Encumbrances
D. 
Encumbrances
Correct Answer D. Encumbrances
Explanation Encumbrances account is credited to close it out at the end of the fiscal year. Encumbrances represent commitments made for goods or services that have not yet been received or paid for. At the end of the fiscal year, any outstanding encumbrances are closed out by crediting the Encumbrances account. This ensures that the budgetary funds are accurately reflected and any remaining commitments are accounted for. The other options mentioned, such as Appropriations Control, Revenue-Property Tax, and Budgetary Fund Balance-Assigned for Encumbrances, are not specifically related to closing out the fiscal year for a governmental unit.
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16.
The primary focus in accounting and reporting for governmental funds is on
A. 
Income determination
B. 
Flow of financial resources
C. 
Capital maintenence
D. 
Transfers relating to proprietary activities
Correct Answer B. Flow of financial resources
Explanation The primary focus in accounting and reporting for governmental funds is on the flow of financial resources. This means that the emphasis is on tracking the inflows and outflows of cash and other financial assets, as well as the sources and uses of these resources. This focus is important in governmental accounting because it helps to ensure transparency and accountability in the management of public funds. By tracking the flow of financial resources, governments can effectively manage their budgets, monitor their financial health, and make informed decisions about resource allocation.
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17.
The governmental fund measurement focus is on the determination of:
A. 
Income, Financial Position and Flow of Financial Resources
B. 
Financial Position
C. 
Flow of Financial Resources
D. 
Financial Position and Flow of Financial Resources
Correct Answer A. Income, Financial Position and Flow of Financial Resources
Explanation The governmental fund measurement focus is on the determination of income, financial position, and flow of financial resources. This means that the focus is not only on the financial position of the government, but also on the inflows and outflows of financial resources, as well as the income generated by the government. By considering all three aspects, the government can have a comprehensive understanding of its financial situation and make informed decisions regarding its resources and budget.
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18.
A Budgetary Fund Balances-Assigned for Encumbrances in excessof a balance of Encumbrances Control indicates
A. 
An excess of vouchers payable over encumbrances
B. 
An excess of purchase order over invoices received
C. 
A recording error
D. 
An excess of appropriations over encumbrances
Correct Answer C. A recording error
Explanation This answer suggests that the indicated balance of Encumbrances Control is incorrect due to a recording error. It implies that the amount assigned for encumbrances in the Budgetary Fund Balances does not match the actual balance of encumbrances.
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19.
The Encumbrances Control account of a governmental unit is debited when
A. 
Goods are received
B. 
A voucher payable is recorded
C. 
A purchase order is approved
D. 
The budget is recorded
Correct Answer C. A purchase order is approved
Explanation The Encumbrances Control account of a governmental unit is debited when a purchase order is approved. This is because when a purchase order is approved, it signifies the commitment to purchase goods or services. The Encumbrances Control account is used to track these commitments and ensure that budgeted funds are not exceeded. By debiting the account, the governmental unit records the approval of the purchase order and the corresponding encumbrance.
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20.
The following pertains to property taxes levied by Cedar City for the calendar year 20X6:
Expected collections during 20X6 500,000
Expected collections during the first 60 days of 20X7 100,000
Expected collections during the remainder of 20X7 60,000
Expected collections during January 20X8 30,000
Estimated to be uncollectible (3/1/X7 through 1/1/X8) 10,000
Total levy 700,000
What amount should Cedar report for 20X6 as revenues from property taxes?
A. 
700,000
B. 
600,000
C. 
690,000
D. 
500,000
Correct Answer B. 600,000
Explanation Allows 60 days
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21.
Oak City issued a purchase order for supplies with an estimated cost of $5,000. When the supplies were received, the accompanying invoice indicated an actual price of $4,950. What amount should Oak debit (credit) to Budgetary Fund Balances-Assigned for Encumbrances after the supplies and invoice received?
A. 
$5,000
B. 
(50)
C. 
4,950
D. 
50
Correct Answer A. $5,000
Explanation Oak City should debit $5,000 to Budgetary Fund Balances-Assigned for Encumbrances after the supplies and invoice are received. This is because the estimated cost of the supplies was $5,000, and the actual price on the invoice matches the estimated cost. Debiting the full amount of the estimated cost ensures that the encumbrance is properly recorded and reflects the amount that was initially planned for in the budget.
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22.
For the budgetary year ending December 31, 20X6, Johnson City's general fund expects the following inflows of resources:
Property taxes, licenses, and fines $9,000,000
Transfer in from internal service fund 500,000
Transfer in from debt service fund 1,000,000
In the budgetary entry, what amount should Johnson record for estimated revenues?
A. 
9,000,000
B. 
9,500,000
C. 
10,500,000
D. 
10,000,000
Correct Answer A. 9,000,000
Explanation The estimated revenues for the budgetary year ending December 31, 20X6 should be recorded based on the inflows of resources mentioned in the question. The only inflow mentioned is the property taxes, licenses, and fines, which amount to $9,000,000. Therefore, the estimated revenues that Johnson should record is $9,000,000.
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23.
Encumbrances outstanding at year-end in a state's general fund should be reported as a
A. 
Liability in the general fund
B. 
Fund balance designation in the general fund
C. 
Fund balance reserve in the general fund
D. 
Liability in the general long-term debt account group
Correct Answer C. Fund balance reserve in the general fund
Explanation Encumbrances outstanding at year-end in a state's general fund should be reported as a fund balance reserve in the general fund. This is because encumbrances represent commitments made for goods or services that have not yet been received or paid for. By reporting them as a fund balance reserve, it indicates that these funds are set aside and reserved for future obligations and cannot be used for other purposes. This ensures transparency and accountability in the financial reporting of the general fund.
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24.
Which of the following statements is correct regarding comparability of governmental financial reports?
A. 
Comparability is not relevant in governmental financial reporting
B. 
Differences between financial reports should be due to substantive differences in underlying transactions or the governmental structure
C. 
Selection of different alternatives in accounting procedures or practices account for the differences between financial reports
D. 
Similarly designated governments perform the same functions
Correct Answer B. Differences between financial reports should be due to substantive differences in underlying transactions or the governmental structure
Explanation The correct answer is that differences between financial reports should be due to substantive differences in underlying transactions or the governmental structure. This means that any variations in financial reports of different governments should be a result of genuine differences in their transactions or the way their governmental structures are set up. This ensures that the financial reports accurately reflect the unique circumstances and operations of each government, allowing for meaningful comparisons to be made. It also promotes transparency and accountability in governmental financial reporting.
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25.
The general fund of Mattville have several interfund activities during the fiscal year ended June 30, 20X9. For each general fund transaction/transfer, select what qualifies as an interfund loan.
A. 
Received bills from an internal service fund for using city-owned vehicles
B. 
Transferred cash to start an enterprise fund. The enterprise fund does not have to return the cash to the general fund
C. 
Received cash from a special revenue fund that was discontinued
D. 
Transferred cash to a capital projects fund to help construct a building
E. 
Transferred cash to a debt service fund to pay interest and principal of a general long-term debt
F. 
Transferred cash to the pension trust fund representing the employer's contribution toward the pension of general fund employees
G. 
Transferred resources to an enterprise fund. It is expected that these resources will be repaid with interest
H. 
Transferred cash to a special revenue fund. The special revenue fund incurred and paid expenditures on behalf of the general fund
I. 
Received cash from an internal service fund. The cash received represented repayment of an advance made during the previous year
J. 
Received bills from an enterprise fund for using public parking facilities
Correct Answer(s) G. Transferred resources to an enterprise fund. It is expected that these resources will be repaid with interest I. Received cash from an internal service fund. The cash received represented repayment of an advance made during the previous year
Explanation An interfund loan occurs when resources are transferred from one fund to another with the expectation of repayment. In the given answer, the transfer of resources to an enterprise fund qualifies as an interfund loan because it is expected that these resources will be repaid with interest. Similarly, receiving cash from an internal service fund as repayment of an advance made during the previous year also qualifies as an interfund loan. In both cases, there is an expectation of repayment, either with interest or as a repayment of a previous advance.
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26.
The general fund of Mattville have several interfund activities during the fiscal year ended June 30, 20X9. For each general fund transaction/transfer, select what qualifies as an interfund service provided and used?.
A. 
Received bills from an internal service fund for using city-owned vehicles
B. 
Transferred cash to start an enterprise fund. The enterprise fund does not have to return the cash to the general fund
C. 
Received cash from a special revenue fund that was discontinued
D. 
Transferred cash to a capital projects fund to help construct a building
E. 
Transferred cash to a debt service fund to pay interest and principal of a general long-term debt
F. 
Transferred cash to the pension trust fund representing the employer's contribution toward the pension of general fund employees
G. 
Transferred resources to an enterprise fund. It is expected that these resources will be repaid with interest
H. 
Transferred cash to a special revenue fund. The special revenue fund incurred and paid expenditures on behalf of the general fund
I. 
Received cash from an internal service fund. The cash received represented repayment of an advance made during the previous year
J. 
Received bills from an enterprise fund for using public parking facilities
Correct Answer(s) A. Received bills from an internal service fund for using city-owned vehicles J. Received bills from an enterprise fund for using public parking facilities
Explanation The transactions/activities that qualify as an interfund service provided and used are when the general fund receives bills from an internal service fund for using city-owned vehicles and when the general fund receives bills from an enterprise fund for using public parking facilities. In both cases, the general fund is utilizing services provided by other funds within the organization.
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27.
The general fund of Mattville have several interfund activities during the fiscal year ended June 30, 20X9. For each general fund transaction/transfer, select what qualifies as an interfund transfer?.
A. 
Received bills from an internal service fund for using city-owned vehicles
B. 
Transferred cash to start an enterprise fund. The enterprise fund does not have to return the cash to the general fund
C. 
Received cash from a special revenue fund that was discontinued
D. 
Transferred cash to a capital projects fund to help construct a building
E. 
Transferred cash to a debt service fund to pay interest and principal of a general long-term debt
F. 
Transferred cash to the pension trust fund representing the employer's contribution toward the pension of general fund employees
G. 
Transferred resources to an enterprise fund. It is expected that these resources will be repaid with interest
H. 
Transferred cash to a special revenue fund. The special revenue fund incurred and paid expenditures on behalf of the general fund
I. 
Received cash from an internal service fund. The cash received represented repayment of an advance made during the previous year
J. 
Received bills from an enterprise fund for using public parking facilities
Correct Answer(s) B. Transferred cash to start an enterprise fund. The enterprise fund does not have to return the cash to the general fund C. Received cash from a special revenue fund that was discontinued D. Transferred cash to a capital projects fund to help construct a building E. Transferred cash to a debt service fund to pay interest and principal of a general long-term debt F. Transferred cash to the pension trust fund representing the employer's contribution toward the pension of general fund employees
Explanation Interfund transfers refer to the movement of cash or resources between different funds within an organization. In this case, the following transactions qualify as interfund transfers: transferring cash to start an enterprise fund (as the enterprise fund does not have to return the cash to the general fund), receiving cash from a special revenue fund that was discontinued, transferring cash to a capital projects fund to help construct a building, transferring cash to a debt service fund to pay interest and principal of a general long-term debt, and transferring cash to the pension trust fund representing the employer's contribution toward the pension of general fund employees. These transactions involve the movement of funds between different funds within the organization.
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28.
The general fund of Mattville have several interfund activities during the fiscal year ended June 30, 20X9. For each general fund transaction/transfer, select what qualifies as an interfund reimbursement?.
A. 
Received bills from an internal service fund for using city-owned vehicles
B. 
Transferred cash to start an enterprise fund. The enterprise fund does not have to return the cash to the general fund
C. 
Received cash from a special revenue fund that was discontinued
D. 
Transferred cash to a capital projects fund to help construct a building
E. 
Transferred cash to a debt service fund to pay interest and principal of a general long-term debt
F. 
Transferred cash to the pension trust fund representing the employer's contribution toward the pension of general fund employees
G. 
Transferred resources to an enterprise fund. It is expected that these resources will be repaid with interest
H. 
Transferred cash to a special revenue fund. The special revenue fund incurred and paid expenditures on behalf of the general fund
I. 
Received cash from an internal service fund. The cash received represented repayment of an advance made during the previous year
J. 
Received bills from an enterprise fund for using public parking facilities
Correct Answer H. Transferred cash to a special revenue fund. The special revenue fund incurred and paid expenditures on behalf of the general fund
Explanation The transfer of cash to a special revenue fund qualifies as an interfund reimbursement because the special revenue fund incurred and paid expenditures on behalf of the general fund. This means that the special revenue fund used its own resources to cover expenses that were originally the responsibility of the general fund, and now the general fund is reimbursing the special revenue fund for those expenses.
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29.
What is the journal entry for the following transaction?
Adoption of budget:
Estimated revenues 950
Appropriations 900
A. 
ESTIMATED REVENUES CONTROL 950
APPROPRIATIONS CONTROL 900
BUDGETARY FUND BALANCE-UNRESERVED 50
B. 
APPROPRIATIONS CONTROL 900
BUDGETARY FUND BALANCE-UNRESERVED 50
ESTIMATED REVENUES CONTROL 950
C. 
ESTIMATED REVENUES CONTROL 950
APPROPRIATIONS CONTROL 900
BUDGETARY FUND BALANCE-RESERVED 50
D. 
ENCUMBRANCES 900
BUDGETARY FUND BALANCE-RESERVED 50
EXPENDITURES 950
Correct Answer A. ESTIMATED REVENUES CONTROL 950
APPROPRIATIONS CONTROL 900
BUDGETARY FUND BALANCE-UNRESERVED 50
Explanation The journal entry represents the adoption of a budget. The estimated revenues control account is debited for the estimated revenues of $950, while the appropriations control account is credited for the appropriations of $900. This indicates that the estimated revenues are expected to be $950 and the appropriations are set at $900. The budgetary fund balance-unreserved account is credited for the difference of $50, which represents the unreserved balance of the budget. This entry ensures that the budget is properly recorded and reflects the estimated revenues and appropriations.
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30.
Tax. Levy. The tax levy is $602, but it is estimated that $12 of the levy will prove to be uncollectible
A. 
Accounts Receivable 602
Allowance for Doubtful Accounts 12
Revenues 590
B. 
Accounts Receivable 602
Revenues 602
C. 
Taxes Receivable - Current 602
Allowance for Doubtful Accounts 12
Revenues 590
D. 
Revenues 590
Allowance for Doubtful Accounts 12
Taxes Receivable - Current 602
Correct Answer C. Taxes Receivable - Current 602
Allowance for Doubtful Accounts 12
Revenues 590
Explanation The tax levy of $602 is recorded as an increase in Taxes Receivable - Current. The estimated uncollectible amount of $12 is recorded as an increase in the Allowance for Doubtful Accounts. The remaining amount of $590 is recorded as an increase in Revenues. This is because the tax levy is an amount that is expected to be collected in the future, so it is recorded as a receivable. The estimated uncollectible amount is recorded as an allowance to account for the potential loss. The remaining amount is recognized as revenue earned.
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31.
Collection of taxes. During the year $582 of the tax levy was collected, and $11 was written off as uncollectible. Of remaining $9, $5 is considered uncollectible. What is the journal entry?
A. 
Cash 582
Allow. for Uncoll. Accts-Cur 11
Taxes Received 593
B. 
Cash 582
Allow. for Uncoll. Accts-Cur 11
Taxes Received 593
Taxes Received - Deliquent 9
Taxes Received - Current 9
Allowance for U/A - Current 1
Revenues 4
Allow for U/A- Deliquent 5
C. 
Cash 582
Allow. for Uncoll. Accts-Cur 11
Revenues 593
Taxes Received - Deliquent 9
Taxes Received - Current 9
Revenues 5
Allow for U/A- Deliquent 5
Correct Answer B. Cash 582
Allow. for Uncoll. Accts-Cur 11
Taxes Received 593
Taxes Received - Deliquent 9
Taxes Received - Current 9
Allowance for U/A - Current 1
Revenues 4
Allow for U/A- Deliquent 5
Explanation The journal entry records the collection of taxes and the write-off of uncollectible amounts. The first entry debits Cash for $582, which represents the amount of taxes collected. The second entry credits Allowance for Uncollectible Accounts - Current for $11, which represents the amount of taxes that were written off as uncollectible. The third entry credits Taxes Received for $593, which represents the net amount of taxes collected after considering the write-off. The fourth entry debits Taxes Received - Delinquent for $9, which represents the portion of the remaining taxes that is considered uncollectible. The fifth entry credits Taxes Received - Current for $9, which represents the remaining taxes that are expected to be collected. The sixth entry debits Allowance for Uncollectible Accounts - Current for $1, which represents the decrease in the allowance due to the write-off. The seventh entry credits Revenues for $4, which represents the increase in revenue due to the collection of taxes. The eighth entry credits Allowance for Uncollectible Accounts - Delinquent for $5, which represents the increase in the allowance for the remaining uncollectible taxes.
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32.
Other cash receipts. Other revenues collected in cash totaled $351.What is the journal entry?
A. 
Cash 351
Allow for U/A 35
Revenues 316
B. 
Taxes Receivable 351
Revenues 351
C. 
Budgetary Fund Balance 351
Revenues 351
D. 
Cash 351
Revenues 351
Correct Answer D. Cash 351
Revenues 351
33.
What are the two accounts needed to record the following entry. During the year, appropriations were encumbered for $213 of purchase orders issued, of which $198 were completed and vouchered at an actual cost of $195.
A. 
Dr: Encumbrances
B. 
Dr: Budgetary Fund Balance
C. 
Dr: Cash
D. 
Cr: Budgetary Fund Balance
E. 
Cr: Encumbrances
F. 
Cr: Appropriations Control
G. 
Cr: Vouchers Payable
Correct Answer(s) A. Dr: Encumbrances D. Cr: Budgetary Fund Balance
Explanation The entry is recording the encumbrances made for purchase orders issued during the year. The account "Encumbrances" is debited to reflect the increase in encumbrances, while the account "Budgetary Fund Balance" is credited to show the decrease in available funds. This entry helps in tracking and managing the budget for the organization.