Exam 3: Issues of Budgeting and Control

A governmental entity has formally integrated the budget into its accounting records and uses encumbrance accounting.During the year the government ordered but had not yet received a new police car.What effect will this event have on the unencumbered balance in the account "Expenditures-capital outlay, police department"?

Encumbrances and expenditures both reduce total fund balances of state and local governments.

Washington County received goods that had been approved for purchase but for which payment had not yet been made.Should the following accounts be increased? Expenditures Encumbrances a No No b Yes Yes c Yes No d No Yes

Periodic allocations of funds to departments or agencies are generally called

At year-end Oakland County had $3,000 in outstanding purchase commitments on the books.After the appropriate closing entries were made, what is the effect on the total Fund Balance of Oakland County?

A governmental entity has formally integrated the budget into its accounting records.At the end of the third quarter the ledger account "Expenditures--salaries" has a $100,000 debit balance.Which of the following is a true statement?

Hill City uses encumbrance accounting to control expenditures.However, it charges the cost of outstanding purchase commitments to expenditures in the year they are received, not in the year they are ordered.If Hill City had $10,000 of purchase commitments outstanding at the end of Year 1 and received those goods during Year 2 at a cost of $9,800, what would be the impact on total Fund Balance for Year 2?

GASB requires that governmental entities present their budgeted-to-actual comparison data on which of the following bases of accounting?

To close Reserve for Encumbrances at the end of the year which of the following entries should be made?

Which of the following bases of accounting has been established by GASB for use in the preparation of the general fund budget?

Which of the following is NOT a function of a budget in the governmental environment?

Why would a government be more likely than a not-for-profit organization to integrate its budget into its accounting system?

A public school district formally adopted a budget with estimated revenues of $800 and approved expenditures of $780.Which of the following is the appropriate entry to record the budget?

A county previously encumbered $15,000 for the acquisition of supplies.The supplies were received at a total cost of $14,700.To recognize this event the county should make which of the following entries?

Lincoln County uses encumbrance accounting to control expenditures.It charges the cost of outstanding purchase commitments to expenditures in the year they are ordered, not in the year they are received.If the County had $7,000 of purchase commitments outstanding at the end of Year 1 and received those goods during Year 2 at a cost of $7,800, what would be the impact on total Fund Balance for Year 2?

A university that formally integrates the budget in the accounting system and uses encumbrance accounting orders some new computers that will cost approximately $20,000.To recognize this event the university should make which of the following entries?

Which of the following is a primary benefit of a performance budget?

An officially adopted budget is generally called

In which of the following cases would the reserve for encumbrances account be decreased?

A city received supplies that had been previously encumbered.The supplies were encumbered for $5,000 and had an actual cost of $4,900.To recognize this event the county should make which of the following entries?