Exam 7: Capital Assets and Investments in Marketable Securities

Governments invest in marketable securities for much the same reason that businesses do-to earn a return on cash that otherwise would be unproductive.

The government-wide financial statements report capital assets:

Governments must disclose information about investment risks in which of the following categories?

To elect not to capitalize works of art and similar assets, a government must see that the assets meet all of the following criteria EXCEPT

What amount of gain/loss should be reported in the government-wide financial statements?

The amount of gain or loss that should be recognized on this transaction in the general fund financial statements is:

If a government elects the modified approach with regard to capitalization of infrastructure

Changes in the fair value of derivative instruments that qualify as hedges should be reported as

For a government that elects to capitalize its works of art and similar assets, the appropriate entry for reporting in the government-wide financial statements when receiving a contribution of a work of art is

Prior to the issuance of GASB Statement No.34, state and local governments provided virtually no information as to most of their infrastructure.

Governments do not have to depreciate infrastructure assets if governments can demonstrate they are preserving these assets at a specified condition level.

GASB standards require that depreciation be reported on all capital assets except

Hilltop School District receives a donation of ten computers from Computer Hut, a local computer firm.The cost to Computer Hut of each computer is $2,500.The retail value of each computer is $3,000.Assuming that the district maintains its books and records in a manner that facilitates the preparation of the fund financial statements, what is the appropriate entry in the general fund to record this donation?

General capital assets are not reported in governmental funds because

General capital assets are distinguished from the capital assets of proprietary funds and fiduciary funds.

The "restoration cost" approach to determining the extent of a capital asset impairment

Most infrastructure assets are the responsibility of the federal government, not state and local governments.

Which of the following are NOT infrastructure assets?

How should changes in the fair value of derivatives be reported in a government's financial statements?

Donated assets are reported in the government-wide financial statements at