Question 1

In the Statement of Net Assets, the net assets of a proprietary fund should be displayed in which of the following categories?

Accepted Answer

A) Unrestricted Fund Balance; Restricted Fund Balance, Invested in Capital Assets, Net of Related Debt. 
B) Unrestricted Net Assets; Restricted Net Assets; Invested in Capital Assets, Net of Related Debt. 
C) Unrestricted Net Assets; Restricted Net Assets; Net Assets Available for Use. 
D) Net Assets Available for Use. 
A) Unrestricted Fund Balance; Restricted Fund Balance, Invested in Capital Assets, Net of Related Debt. 
B) Unrestricted Net Assets; Restricted Net Assets; Invested in Capital Assets, Net of Related Debt. 
C) Unrestricted Net Assets; Restricted Net Assets; Net Assets Available for Use. 
D) Net Assets Available for Use.

Question 2

A governmental entity operates landfill.In the Landfill Enterprise Fund financial statements, which of the following would be reported as a restricted asset?

Accepted Answer

A) Cash received from the sale of bonds that must, based on the debt covenant, be spent only on building a new landfill runoff treatment plant. 
B) Cash that management has voted to use only for landfill expansion. 
C) Cash received from the General Fund that will be used only to expand the landfill. 
D) None of the above. 
A) Cash received from the sale of bonds that must, based on the debt covenant, be spent only on building a new landfill runoff treatment plant. 
B) Cash that management has voted to use only for landfill expansion. 
C) Cash received from the General Fund that will be used only to expand the landfill. 
D) None of the above.

Question 3

Use the following information to answer questions 
During the year the City's Self-Insurance Internal Service Fund billed the General Fund $600,000 for "premiums," of which $60,000 was for catastrophic losses and the balance was the premium computed on an actuarially determined basis.During the year the City incurred $500,000 in claims losses.The total amount transferred to the Self-Insurance Fund by the General Fund was $620,000.
-The amount the City General Fund can recognize as an expenditure is

Accepted Answer

A) $620,000. 
B) $600,000. 
C) $540,000. 
D) $500,000. 
A) $620,000. 
B) $600,000. 
C) $540,000. 
D) $500,000.

Question 4

Which of the following is NOT true about internal service funds as reported in the fund financial statements?

Accepted Answer

A) Costs reported by internal service funds are reported twice within the same set of financial statements. 
B) Billing rates must be set to cover the full cost of providing the goods or services. 
C) Depreciation can be charged to governmental funds through the billing rates established by the internal service fund. 
D) Deficits or surpluses in the general fund can be transferred to the internal service fund by adjusting the billing rates. 
A) Costs reported by internal service funds are reported twice within the same set of financial statements. 
B) Billing rates must be set to cover the full cost of providing the goods or services. 
C) Depreciation can be charged to governmental funds through the billing rates established by the internal service fund. 
D) Deficits or surpluses in the general fund can be transferred to the internal service fund by adjusting the billing rates.

Question 5

Marsh Lake County operates a solid waste landfill that is accounted for in a governmental fund.The County calculated this year's portion of the total closure and postclosure costs associated with the landfill to be $600,000.The entry to record this cost should be

Accepted Answer

A) Debit Landfill expenditure $600,000; Credit Liability for landfill costs $600,000 
B) Debit Landfill expenditure $600,000; Credit Liability for landfill costs $600,000 AND
Include $600,000 as an addition on the Schedule of Changes in Long-Term Obligations. 
C) No entry in the fund; include $600,000 on the Schedule of Changes in Long-Term Obligations. 
D) No entry in any fund or Schedule. 
A) Debit Landfill expenditure $600,000; Credit Liability for landfill costs $600,000 
B) Debit Landfill expenditure $600,000; Credit Liability for landfill costs $600,000 AND
Include $600,000 as an addition on the Schedule of Changes in Long-Term Obligations. 
C) No entry in the fund; include $600,000 on the Schedule of Changes in Long-Term Obligations. 
D) No entry in any fund or Schedule.

Question 6

The appropriate basis of accounting for the proprietary funds of a governmental entity is

Accepted Answer

A) Cash basis. 
B) Modified accrual. 
C) Full accrual. 
D) None of the above. 
A) Cash basis. 
B) Modified accrual. 
C) Full accrual. 
D) None of the above.

Question 7

The proprietary fund operating statement includes ALL changes in net assets including capital contributions.

Accepted Answer

A) True 
 B)False

Question 8

The reporting of activities by an Enterprise Fund is most likely optional if:

Accepted Answer

A) Fees are charged to external users for goods or services. 
B) The entity's pricing policies set fees and charges to recover costs. 
C) The entity is financed with debt, and the only security is a pledge of the activity's net revenues from fees and charges. 
D) The entity's costs are legally required to be recovered from fees and charges. 
A) Fees are charged to external users for goods or services. 
B) The entity's pricing policies set fees and charges to recover costs. 
C) The entity is financed with debt, and the only security is a pledge of the activity's net revenues from fees and charges. 
D) The entity's costs are legally required to be recovered from fees and charges.

Question 9

Cash flows from Noncapital Financing Activities include which of the following as outflows

Accepted Answer

A) Repayment of bonds issued to finance construction of City Hall. 
B) Deposits into investment pools. 
C) Loans to another fund of the entity. 
D) Grants made to other governments to support operating activities. 
A) Repayment of bonds issued to finance construction of City Hall. 
B) Deposits into investment pools. 
C) Loans to another fund of the entity. 
D) Grants made to other governments to support operating activities.

Question 10

Cash flows from Capital and Related Financing Activities include which of the following as inflows

Accepted Answer

A) Repayment of bonds issued to construct a new city hall building. 
B) Interest received on investments. 
C) Grant from the state to subsidize the mass transit system. 
D) Receipts from the sale of an old backhoe that had been used in general government activities. 
A) Repayment of bonds issued to construct a new city hall building. 
B) Interest received on investments. 
C) Grant from the state to subsidize the mass transit system. 
D) Receipts from the sale of an old backhoe that had been used in general government activities.

Question 11

Over the long run, governmental internal service funds are intended to

Accepted Answer

A) Generate revenues sufficient to cover the full costs of providing services. 
B) Generate revenues sufficient to cover the full costs of providing services and to earn a profit. 
C) Generate revenues sufficient to cover the current operating costs of providing services. 
D) Generate revenues sufficient to cover the current operating costs of providing services and to earn an operating profit. 
A) Generate revenues sufficient to cover the full costs of providing services. 
B) Generate revenues sufficient to cover the full costs of providing services and to earn a profit. 
C) Generate revenues sufficient to cover the current operating costs of providing services. 
D) Generate revenues sufficient to cover the current operating costs of providing services and to earn an operating profit.

Question 12

Which of the following are required basic statements of a Proprietary Fund?

Accepted Answer

A) Balance Sheet and Income Statement. 
B) Balance Sheet; Statement of Revenues, Expenses, and Changes in Retained Earnings; and Statement of Cash Flows. 
C) Statement of Net Assets and Statement of Revenues, Expenses, and Changes in Fund Net Assets. 
D) Statement of Net Assets; Statement of Revenues, Expenses, and Changes in Fund Net Assets; and Statement of Cash Flows. 
A) Balance Sheet and Income Statement. 
B) Balance Sheet; Statement of Revenues, Expenses, and Changes in Retained Earnings; and Statement of Cash Flows. 
C) Statement of Net Assets and Statement of Revenues, Expenses, and Changes in Fund Net Assets. 
D) Statement of Net Assets; Statement of Revenues, Expenses, and Changes in Fund Net Assets; and Statement of Cash Flows.

In the Statement of Net Assets, the net assets of a proprietary fund should be displayed in which of the following categories?

A governmental entity operates landfill.In the Landfill Enterprise Fund financial statements, which of the following would be reported as a restricted asset?

Which of the following is NOT true about internal service funds as reported in the fund financial statements?

Marsh Lake County operates a solid waste landfill that is accounted for in a governmental fund.The County calculated this year's portion of the total closure and postclosure costs associated with the landfill to be $600,000.The entry to record this cost should be

The appropriate basis of accounting for the proprietary funds of a governmental entity is

The proprietary fund operating statement includes ALL changes in net assets including capital contributions.

The reporting of activities by an Enterprise Fund is most likely optional if:

Cash flows from Noncapital Financing Activities include which of the following as outflows

Cash flows from Capital and Related Financing Activities include which of the following as inflows

Over the long run, governmental internal service funds are intended to

Which of the following are required basic statements of a Proprietary Fund?

The Government and Not-For-Profit Environment

Fund Accounting

Issues of Budgeting and Control

Recognizing Revenues in Governmental Funds

Recognizing Expenditures in Governmental Funds

Accounting for Capital Projects and Debt Service

Capital Assets and Investments in Marketable Securities

Long-Term Obligations

Fiduciary Funds and Permanent Funds

Issues of Reporting, Disclosure, and Financial Analysis

Not-For-Profit Organizations

Colleges and Universities

Health Care Providers

Managing for Results

Auditing Governments and Not-For-Profit Organizations

Federal Government Accounting

Filters

Exam 9: Business-Type Activities

In the Statement of Net Assets, the net assets of a proprietary fund should be displayed in which of the following categories?

A governmental entity operates landfill.In the Landfill Enterprise Fund financial statements, which of the following would be reported as a restricted asset?

Which of the following is NOT true about internal service funds as reported in the fund financial statements?

Marsh Lake County operates a solid waste landfill that is accounted for in a governmental fund.The County calculated this year's portion of the total closure and postclosure costs associated with the landfill to be $600,000.The entry to record this cost should be

The appropriate basis of accounting for the proprietary funds of a governmental entity is

The proprietary fund operating statement includes ALL changes in net assets including capital contributions.

The reporting of activities by an Enterprise Fund is most likely optional if:

Cash flows from Noncapital Financing Activities include which of the following as outflows

Cash flows from Capital and Related Financing Activities include which of the following as inflows

Over the long run, governmental internal service funds are intended to

Which of the following are required basic statements of a Proprietary Fund?

The Government and Not-For-Profit Environment

Fund Accounting

Issues of Budgeting and Control

Recognizing Revenues in Governmental Funds

Recognizing Expenditures in Governmental Funds

Accounting for Capital Projects and Debt Service

Capital Assets and Investments in Marketable Securities

Long-Term Obligations

Fiduciary Funds and Permanent Funds

Issues of Reporting, Disclosure, and Financial Analysis

Not-For-Profit Organizations

Colleges and Universities

Health Care Providers

Managing for Results

Auditing Governments and Not-For-Profit Organizations

Federal Government Accounting

Filters