Question 1

Permanent funds are classified as

Accepted Answer

A) Governmental funds. 
B) Proprietary funds. 
C) Fiduciary funds. 
D) Trust funds. 
A) Governmental funds. 
B) Proprietary funds. 
C) Fiduciary funds. 
D) Trust funds. A

Question 2

Employers that provide postemployment healthcare benefit plans should account for them in private-purpose trust funds.

Accepted Answer

A) True 
 B)False  False

Question 3

A major difference between defined benefit pension plans and defined contribution pension plans is that

Accepted Answer

A) In defined benefit plans, the risk of loss is borne primarily by the employer. 
B) Accounting for defined benefit plans is much simpler than accounting for defined contribution plans. 
C) Employees generally are required to contribute to defined contribution plans but not to defined benefit plans. 
D) There is no major difference between the two kinds of pension plans. 
A) In defined benefit plans, the risk of loss is borne primarily by the employer. 
B) Accounting for defined benefit plans is much simpler than accounting for defined contribution plans. 
C) Employees generally are required to contribute to defined contribution plans but not to defined benefit plans. 
D) There is no major difference between the two kinds of pension plans. A

Question 4

The fiduciary fund financial statements in a government's annual financial report comprise

Accepted Answer

A) Consolidated statements only--no separate statements for individual pension plans. 
B) A separate column in each statement for each fiduciary fund type. 
C) A consolidated assets and benefits statement showing three classes of net assets. 
D) Statements reporting information by major fund. 
A) Consolidated statements only--no separate statements for individual pension plans. 
B) A separate column in each statement for each fiduciary fund type. 
C) A consolidated assets and benefits statement showing three classes of net assets. 
D) Statements reporting information by major fund.

Question 5

Financial assets reported by most investment trust funds of governments should be reported at

Accepted Answer

A) Cost 
B) Amortized historical cost. 
C) Fair value on the date of the financial statements. 
D) Fair value computed by a weighted-average approach. 
A) Cost 
B) Amortized historical cost. 
C) Fair value on the date of the financial statements. 
D) Fair value computed by a weighted-average approach.

Question 6

Several years ago, a donor gave $5 million to Denton City and specified that the principal was to be kept intact but the earnings were to be used to support the operations of city parks.During the current year, the city earned $300,000 on the gift.To what type of fund, should the city transfer the $300,000 earnings?

Accepted Answer

A) It should not make any transfers.The $300,000 should remain in the city's permanent fund. 
B) A special revenue fund. 
C) The general fund. 
D) An enterprise fund. 
A) It should not make any transfers.The $300,000 should remain in the city's permanent fund. 
B) A special revenue fund. 
C) The general fund. 
D) An enterprise fund.

Question 7

An employer may have a liability to a defined benefit pension plan other than for its annual required contributions, depending on the future financial health of the plan.

Accepted Answer

A) True 
 B)False

Question 8

What basis of accounting is used to account for transactions of a government's private-purpose trust fund?

Accepted Answer

A) Full accrual basis of accounting. 
B) Modified accrual basis of accounting. 
C) Cash basis of accounting. 
D) Budgetary basis of accounting. 
A) Full accrual basis of accounting. 
B) Modified accrual basis of accounting. 
C) Cash basis of accounting. 
D) Budgetary basis of accounting.

Question 9

Governments must present which of the following financial statements for fiduciary funds?

Accepted Answer

A) Statement of assets and benefits and statement of cash flows. 
B) Statement of fiduciary net assets and statement of changes in benefits, 
C) Statement of fiduciary net position and statement of changes in fiduciary net position. 
D) Statement of net assets and statement of accrued benefit obligations. 
A) Statement of assets and benefits and statement of cash flows. 
B) Statement of fiduciary net assets and statement of changes in benefits, 
C) Statement of fiduciary net position and statement of changes in fiduciary net position. 
D) Statement of net assets and statement of accrued benefit obligations.

Question 10

In previous years, Boze City had received a $400,000 gift of cash and investments.The donor had specified that the earnings from the gift must be used to beautify city-owned parks and the principal must be re-invested.During the current year, the earnings from this gift were $24,000.The earnings from this gift should generally be considered revenue to which of the following funds?

Accepted Answer

A) Special revenue fund. 
B) Private-purpose trust fund. 
C) Agency fund. 
D) Permanent fund.
Use the following information to answer Questions #3-4
Carl City received $200,000 to help maintain a local art museum that is owned and operated by a not-for-profit organization.During the year the city transferred net earnings of $20,000 to the appropriate entity/fund. 
A) Special revenue fund. 
B) Private-purpose trust fund. 
C) Agency fund. 
D) Permanent fund.
Use the following information to answer Questions #3-4
Carl City received $200,000 to help maintain a local art museum that is owned and operated by a not-for-profit organization.During the year the city transferred net earnings of $20,000 to the appropriate entity/fund.

Question 11

The primary financial statements for a government-sponsored pension plan are:

Accepted Answer

A) Balance sheet and statement of activities. 
B) Balance sheet, statement of activities, and cash flows statement. 
C) Statement of fiduciary net assets and a statement of changes in fiduciary net assets 
D) Balance sheet, statement of activities, cash flows statement, and statement of funding progress. 
A) Balance sheet and statement of activities. 
B) Balance sheet, statement of activities, and cash flows statement. 
C) Statement of fiduciary net assets and a statement of changes in fiduciary net assets 
D) Balance sheet, statement of activities, cash flows statement, and statement of funding progress.

Question 12

Financial assets reported by qqqqqqqqqqqqq2a7-like investment pools should be reported at

Accepted Answer

A) Fair value at the date of the financial statements. 
B) Amortized historical cost. 
C) Fair value computed using a weighted-average approach. 
D) Cost. 
A) Fair value at the date of the financial statements. 
B) Amortized historical cost. 
C) Fair value computed using a weighted-average approach. 
D) Cost.

Question 13

GASB standards of accounting for other postemployment benefits (OPEB)require that governments

Accepted Answer

A) Fund their OPEB benefits on an actuarially determined basis. 
B) Report actuarially determined required contributions as OPEB expense, regardless of whether the government actually makes the contributions. 
C) Report OPEB costs in accordance with the FASB's standards of accounting for OPEB. 
D) Only disclose an estimate of their OPEB liabilities. 
A) Fund their OPEB benefits on an actuarially determined basis. 
B) Report actuarially determined required contributions as OPEB expense, regardless of whether the government actually makes the contributions. 
C) Report OPEB costs in accordance with the FASB's standards of accounting for OPEB. 
D) Only disclose an estimate of their OPEB liabilities.

Question 14

Which of the following is NOT a fiduciary fund?

Accepted Answer

A) Pension trust fund. 
B) Investment trust fund. 
C) Permanent fund. 
D) Private-purpose trust fund. 
A) Pension trust fund. 
B) Investment trust fund. 
C) Permanent fund. 
D) Private-purpose trust fund.

Question 15

In accounting for permanent funds only the income can be spent; the principal must be preserved intact.

Accepted Answer

A) True 
 B)False

Question 16

Assets reported in a government's investment trust fund should include:

Accepted Answer

A) Only investments owned by external participants in the investment pool. 
B) Investments of both the sponsoring government and of external participants in the investment pool. 
C) Investments related to the sponsoring government's governmental funds and of external participants in the investment pool. 
D) Investments related to the sponsoring government's other fiduciary funds and of external participants in the investment pool. 
A) Only investments owned by external participants in the investment pool. 
B) Investments of both the sponsoring government and of external participants in the investment pool. 
C) Investments related to the sponsoring government's governmental funds and of external participants in the investment pool. 
D) Investments related to the sponsoring government's other fiduciary funds and of external participants in the investment pool.

Question 17

In an agency fund, assets always equal fund balances because there are no liabilities.

Accepted Answer

A) True 
 B)False

Question 18

GASB standards require a defined benefit pension plan to report investments at fair market value even if the plan's actuary uses a different value in determining the employer's contribution requirements.

Accepted Answer

A) True 
 B)False

Question 19

At the beginning of the year, the permanent fund of Rose City had an investment portfolio with a historical cost of $300,000 and a fair value of $330,000.There were no purchases or sales of securities during the year.At the end of the year the portfolio had a fair value of $360,000.At year-end, the city s account for this increase in fair value in which of the following ways?

Accepted Answer

A) Credit Investment income, $30,000. 
B) Credit Investment income, $60,000. 
C) Credit Fund balance, $30,000. 
D) No entry should be made to recognize an increase in fair value. 
A) Credit Investment income, $30,000. 
B) Credit Investment income, $60,000. 
C) Credit Fund balance, $30,000. 
D) No entry should be made to recognize an increase in fair value.

Question 20

A wealthy citizen provided in her will for a gift of cash and other assets to Balsa city.The will specified that the gift was to be kept intact and that the earnings from the gift were to be used to support public parks.At the time of the donation, the gift had a book value in the hands of the donor of $300,000 and a fair value of $500,000.When recording this gift the city would credit

Accepted Answer

A) Contributions revenues $500,000. 
B) Other financing sources-contributions $500,000. 
C) Contributions revenues $300,000. 
D) Other financing sources-contributions $300,000. 
A) Contributions revenues $500,000. 
B) Other financing sources-contributions $500,000. 
C) Contributions revenues $300,000. 
D) Other financing sources-contributions $300,000.

Permanent funds are classified as

Employers that provide postemployment healthcare benefit plans should account for them in private-purpose trust funds.

A major difference between defined benefit pension plans and defined contribution pension plans is that

The fiduciary fund financial statements in a government's annual financial report comprise

Financial assets reported by most investment trust funds of governments should be reported at

An employer may have a liability to a defined benefit pension plan other than for its annual required contributions, depending on the future financial health of the plan.

What basis of accounting is used to account for transactions of a government's private-purpose trust fund?

Governments must present which of the following financial statements for fiduciary funds?

The primary financial statements for a government-sponsored pension plan are:

Financial assets reported by qqqqqqqqqqqqq2a7-like investment pools should be reported at

GASB standards of accounting for other postemployment benefits (OPEB)require that governments

Which of the following is NOT a fiduciary fund?

In accounting for permanent funds only the income can be spent; the principal must be preserved intact.

Assets reported in a government's investment trust fund should include:

In an agency fund, assets always equal fund balances because there are no liabilities.

GASB standards require a defined benefit pension plan to report investments at fair market value even if the plan's actuary uses a different value in determining the employer's contribution requirements.

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

Business-Type Activities

Issues of Reporting, Disclosure, and Financial Analysis

Not-For-Profit Organizations

Colleges and Universities

Health Care Providers

Managing for Results

Auditing Governments and Notforprofit Organizations

Federal Government Accounting

Filters

Exam 10: Pensions and Other Fiduciary Activities

Permanent funds are classified as

Employers that provide postemployment healthcare benefit plans should account for them in private-purpose trust funds.

A major difference between defined benefit pension plans and defined contribution pension plans is that

The fiduciary fund financial statements in a government's annual financial report comprise

Financial assets reported by most investment trust funds of governments should be reported at

An employer may have a liability to a defined benefit pension plan other than for its annual required contributions, depending on the future financial health of the plan.

What basis of accounting is used to account for transactions of a government's private-purpose trust fund?

Governments must present which of the following financial statements for fiduciary funds?

The primary financial statements for a government-sponsored pension plan are:

Financial assets reported by qqqqqqqqqqqqq2a7-like investment pools should be reported at

GASB standards of accounting for other postemployment benefits (OPEB)require that governments

Which of the following is NOT a fiduciary fund?

In accounting for permanent funds only the income can be spent; the principal must be preserved intact.

Assets reported in a government's investment trust fund should include:

In an agency fund, assets always equal fund balances because there are no liabilities.

GASB standards require a defined benefit pension plan to report investments at fair market value even if the plan's actuary uses a different value in determining the employer's contribution requirements.

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

Business-Type Activities

Issues of Reporting, Disclosure, and Financial Analysis

Not-For-Profit Organizations

Colleges and Universities

Health Care Providers

Managing for Results

Auditing Governments and Notforprofit Organizations

Federal Government Accounting

Filters