Question 1

Which of the following organizations or units would least likely be accounted for by an enterprise fund?

Accepted Answer

A)  A hospital. 
B)  An airport. 
C)  The computer department. 
D)  A sports stadium. 
A)  A hospital. 
B)  An airport. 
C)  The computer department. 
D)  A sports stadium.

Question 2

The balance sheet format recommended for financial statements submitted to the NARUC and FERC for utilities subject to regulatory reporting requirements displays Utility Plant before Current and Accrued Assets and Long-Term Debt before Current and Accrued Liabilities.

Accepted Answer

A) True 
 B)False

Question 3

GASB requires interest capitalization for self-constructed assets of proprietary funds,except those constructed with general long-term debt that will be repaid from resources of governmental activities.

Accepted Answer

A) True 
 B)False

Question 4

Unbilled customer accounts receivable should be reflected in the balance sheet of a governmentally owned utility even though the exact amount of service to be billed is unknown until the customers' meters can be read.

Accepted Answer

A) True 
 B)False

Question 5

When utility customers are billed during the year,the enterprise fund journal entry will include

Accepted Answer

A)  A debit to Sales of Water. 
B)  A debit to Cash - Restricted. 
C)  A debit to Customer Accounts Receivable. 
D)  All of the above. 
A)  A debit to Sales of Water. 
B)  A debit to Cash - Restricted. 
C)  A debit to Customer Accounts Receivable. 
D)  All of the above.

Question 6

Which of the following is not a typical means of dissolving an internal service fund that a city no longer needs or wants?

Accepted Answer

A)  Conversion of the fund's noncash assets to cash and distribution of the cash to another fund or funds. 
B)  Transfer the fund's assets to another fund that will continue the same or similar operating activities. 
C)  Distribute the fund's assets in kind to another fund or funds that will not continue the same or similar operating activities. 
D)  Transfer the fund's assets to a not-for-profit organization that provides charitable services in the community. 
A)  Conversion of the fund's noncash assets to cash and distribution of the cash to another fund or funds. 
B)  Transfer the fund's assets to another fund that will continue the same or similar operating activities. 
C)  Distribute the fund's assets in kind to another fund or funds that will not continue the same or similar operating activities. 
D)  Transfer the fund's assets to a not-for-profit organization that provides charitable services in the community.

Question 7

A government provided original financing for its supplies fund by a transfer of $40,000 cash from the General Fund.The transferee fund credited the amount to Interfund Loan from General Fund-Noncurrent.Assuming that the terminology is correct,how should the transfer be classified in the statements of the supplies fund? Suggest an appropriate name for the corresponding account in the General Fund; how should the corresponding account be shown in the statements of the General Fund?

Accepted Answer

In governmental accounting, when a trans

Question 8

The Supplies Fund,an internal service fund,of a certain city recorded the following journal entry:
   In the entry above,explain the difference between the accounts "Interfund Loan from Water Utility Fund" and "Interfund Transfer In from General Fund."

Accepted Answer

The answer of The Supplies Fund,an internal service fund,of a...

Question 9

The City of Jennings operates a central motor pool as an internal service fund for the benefit of the city's other funds and departments.In the current year,this fund billed the Community Services Department $30,000 for vehicle rentals.What account should the internal service fund use to record these billings?

Accepted Answer

A)  Interfund Transfers In. 
B)  Interfund Exchanges. 
C)  Billings to Departments. 
D)  Cost of Providing Rentals to Other Funds and Units. 
A)  Interfund Transfers In. 
B)  Interfund Exchanges. 
C)  Billings to Departments. 
D)  Cost of Providing Rentals to Other Funds and Units.

Question 10

The following cash transactions were among those reported by Crawford County's Water and Sewer Enterprise Fund for the year:   In the Water and Sewer Enterprise Fund's statement of cash flows for the year ended December 31,what amount should be reported as cash flows from capital and related financing activities?

Accepted Answer

A)  $5,000,000. 
B)  $6,000,000. 
C)  $8,000,000. 
D)  $9,000,000. 
A)  $5,000,000. 
B)  $6,000,000. 
C)  $8,000,000. 
D)  $9,000,000.

Question 11

A municipal solid waste landfill (MSWLF)accounted for by an enterprise fund should recognize an expense and liability for the year in the amount of

Accepted Answer

A)  The estimated total current costs for closure and postclosure of the MSWLF determined at the time the landfill is placed into initial operation divided by the estimated number of years the landfill will be operated. 
B)  The estimated total current costs for closure and postclosure of the MSWLF as reevaluated at the end of each fiscal year divided by the remaining estimated number of years the landfill will be operated. 
C)  A portion of the estimated total current costs for closure and postclosure of the MSWLF,determined at the time the landfill is placed into initial operation,equal to the ratio of landfill used during the year to its total capacity. 
D)  A portion of the estimated total current costs for closure and postclosure of the MSWLF,as reevaluated at the end of the fiscal year,equal to the ratio of landfill used during the year to its total capacity. 
A)  The estimated total current costs for closure and postclosure of the MSWLF determined at the time the landfill is placed into initial operation divided by the estimated number of years the landfill will be operated. 
B)  The estimated total current costs for closure and postclosure of the MSWLF as reevaluated at the end of each fiscal year divided by the remaining estimated number of years the landfill will be operated. 
C)  A portion of the estimated total current costs for closure and postclosure of the MSWLF,determined at the time the landfill is placed into initial operation,equal to the ratio of landfill used during the year to its total capacity. 
D)  A portion of the estimated total current costs for closure and postclosure of the MSWLF,as reevaluated at the end of the fiscal year,equal to the ratio of landfill used during the year to its total capacity.

Question 12

Which of the following account balances would only be reported if a city-owned utility followed regulatory accounting principles?

Accepted Answer

A)  Depreciation expense. 
B)  Pumping expense. 
C)  Restricted Assets-Cash. 
D)  Utility Plant Acquisition Adjustments. 
A)  Depreciation expense. 
B)  Pumping expense. 
C)  Restricted Assets-Cash. 
D)  Utility Plant Acquisition Adjustments.

Question 13

Governments can follow either the GASB or FASB Codification.

Accepted Answer

A) True 
 B)False

Question 14

Under utility regulatory accounting principles (RAP),the account "Utility Plant Acquisition Adjustment" reflects

Accepted Answer

A)  The difference between the amount paid for utility plant and the amount originally paid by the utility that first placed the plant into public service,less accumulated depreciation. 
B)  The difference between the fair market value of the utility plant and the amount paid for it,less accumulated depreciation. 
C)  The difference between the amount paid for the utility plant less its current replacement cost. 
D)  The difference between the amount paid for the utility plant less the fair market value of its tangible plant assets. 
A)  The difference between the amount paid for utility plant and the amount originally paid by the utility that first placed the plant into public service,less accumulated depreciation. 
B)  The difference between the fair market value of the utility plant and the amount paid for it,less accumulated depreciation. 
C)  The difference between the amount paid for the utility plant less its current replacement cost. 
D)  The difference between the amount paid for the utility plant less the fair market value of its tangible plant assets.

Question 15

"Enterprise funds should not be permitted to accumulate unrestricted net position,since to do so would indicate overpricing of its services." Do you agree? Why or why not?

Accepted Answer

The answer of "Enterprise funds should not be permitted to...

Question 16

Premiums or discounts on bonds payable issued by enterprise funds should be accounted for in the same manner as those of a comparable business entity.

Accepted Answer

A) True 
 B)False

Question 17

Internal service funds of one government may not provide goods or services,on a cost-reimbursement basis,to other governments.

Accepted Answer

A) True 
 B)False

Question 18

An internal service fund can be liquidated only if there is a ready and willing buyer for the fund's assets.

Accepted Answer

A) True 
 B)False

Question 19

Which of the following would be reflected in the operating statement of a proprietary fund?

Accepted Answer

A)  Incurrence of interest expense. 
B)  Repayment of the principal of debt. 
C)  Issuance of debt. 
D)  Purchase of a capital asset. 
A)  Incurrence of interest expense. 
B)  Repayment of the principal of debt. 
C)  Issuance of debt. 
D)  Purchase of a capital asset.

Question 20

What amount of the following items should be accounted for in an internal service fund?

Accepted Answer

A)  $2,100,000. 
B)  $1,760,000. 
C)  $1,640,000. 
D)  $350,000. 
A)  $2,100,000. 
B)  $1,760,000. 
C)  $1,640,000. 
D)  $350,000.

Which of the following organizations or units would least likely be accounted for by an enterprise fund?

The balance sheet format recommended for financial statements submitted to the NARUC and FERC for utilities subject to regulatory reporting requirements displays Utility Plant before Current and Accrued Assets and Long-Term Debt before Current and Accrued Liabilities.

GASB requires interest capitalization for self-constructed assets of proprietary funds,except those constructed with general long-term debt that will be repaid from resources of governmental activities.

Unbilled customer accounts receivable should be reflected in the balance sheet of a governmentally owned utility even though the exact amount of service to be billed is unknown until the customers' meters can be read.

When utility customers are billed during the year,the enterprise fund journal entry will include

Which of the following is not a typical means of dissolving an internal service fund that a city no longer needs or wants?

The Supplies Fund,an internal service fund,of a certain city recorded the following journal entry: In the entry above,explain the difference between the accounts "Interfund Loan from Water Utility Fund" and "Interfund Transfer In from General Fund."

A municipal solid waste landfill (MSWLF)accounted for by an enterprise fund should recognize an expense and liability for the year in the amount of

Which of the following account balances would only be reported if a city-owned utility followed regulatory accounting principles?

Governments can follow either the GASB or FASB Codification.

Under utility regulatory accounting principles (RAP),the account "Utility Plant Acquisition Adjustment" reflects

"Enterprise funds should not be permitted to accumulate unrestricted net position,since to do so would indicate overpricing of its services." Do you agree? Why or why not?

Premiums or discounts on bonds payable issued by enterprise funds should be accounted for in the same manner as those of a comparable business entity.

Internal service funds of one government may not provide goods or services,on a cost-reimbursement basis,to other governments.

An internal service fund can be liquidated only if there is a ready and willing buyer for the fund's assets.

Which of the following would be reflected in the operating statement of a proprietary fund?

What amount of the following items should be accounted for in an internal service fund?

Introduction to Accounting and Financial Reporting for Governmental and Not-For-Profit Entities

Principles of Accounting and Financial Reporting for State and Local Governments

Governmental Operating Statement Accounts; Budgetary Accounting

Accounting for Governmental Operating Activities-Illustrative Transactions and Financial Statements

Accounting for General Capital Assets and Capital Projects

Accounting for General Long-Term Liabilities and Debt Service

Accounting for Fiduciary Activities-Agency and Trust Funds

Financial Reporting of State and Local Governments

Analysis of Governmental Financial Performance

Auditing of Governmental and Not-For-Profit Organizations

Budgeting and Performance Measurement

Accounting for Not-For-Profit Organizations

Not-For-Profit Organizations-Regulatory, Taxation, and Performance Issues

Accounting for Colleges and Universities

Accounting for Health Care Organizations

Accounting and Reporting for the Federal Government

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Exam 7: Accounting for the Business-Type Activities of State and Local Governments

Which of the following organizations or units would least likely be accounted for by an enterprise fund?

The balance sheet format recommended for financial statements submitted to the NARUC and FERC for utilities subject to regulatory reporting requirements displays Utility Plant before Current and Accrued Assets and Long-Term Debt before Current and Accrued Liabilities.

GASB requires interest capitalization for self-constructed assets of proprietary funds,except those constructed with general long-term debt that will be repaid from resources of governmental activities.

Unbilled customer accounts receivable should be reflected in the balance sheet of a governmentally owned utility even though the exact amount of service to be billed is unknown until the customers' meters can be read.

When utility customers are billed during the year,the enterprise fund journal entry will include

Which of the following is not a typical means of dissolving an internal service fund that a city no longer needs or wants?

The Supplies Fund,an internal service fund,of a certain city recorded the following journal entry: In the entry above,explain the difference between the accounts "Interfund Loan from Water Utility Fund" and "Interfund Transfer In from General Fund."

A municipal solid waste landfill (MSWLF)accounted for by an enterprise fund should recognize an expense and liability for the year in the amount of

Which of the following account balances would only be reported if a city-owned utility followed regulatory accounting principles?

Governments can follow either the GASB or FASB Codification.

Under utility regulatory accounting principles (RAP),the account "Utility Plant Acquisition Adjustment" reflects

"Enterprise funds should not be permitted to accumulate unrestricted net position,since to do so would indicate overpricing of its services." Do you agree? Why or why not?

Premiums or discounts on bonds payable issued by enterprise funds should be accounted for in the same manner as those of a comparable business entity.

Internal service funds of one government may not provide goods or services,on a cost-reimbursement basis,to other governments.

An internal service fund can be liquidated only if there is a ready and willing buyer for the fund's assets.

Which of the following would be reflected in the operating statement of a proprietary fund?

What amount of the following items should be accounted for in an internal service fund?

Introduction to Accounting and Financial Reporting for Governmental and Not-For-Profit Entities

Principles of Accounting and Financial Reporting for State and Local Governments

Governmental Operating Statement Accounts; Budgetary Accounting

Accounting for Governmental Operating Activities-Illustrative Transactions and Financial Statements

Accounting for General Capital Assets and Capital Projects

Accounting for General Long-Term Liabilities and Debt Service

Accounting for Fiduciary Activities-Agency and Trust Funds

Financial Reporting of State and Local Governments

Analysis of Governmental Financial Performance

Auditing of Governmental and Not-For-Profit Organizations

Budgeting and Performance Measurement

Accounting for Not-For-Profit Organizations

Not-For-Profit Organizations-Regulatory, Taxation, and Performance Issues

Accounting for Colleges and Universities

Accounting for Health Care Organizations

Accounting and Reporting for the Federal Government

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