Question 1

With respect to Capital Projects Funds,which of the following is correct?

Accepted Answer

A)  These funds commonly account for resources provided by long-term debt issues or dedicated taxes. 
B)  Capital assets appear in both the government-wide and the fund basis financial statements 
C)  A and B are both correct 
D)  Neither A or B is correct 
A)  These funds commonly account for resources provided by long-term debt issues or dedicated taxes. 
B)  Capital assets appear in both the government-wide and the fund basis financial statements 
C)  A and B are both correct 
D)  Neither A or B is correct

Question 2

Budgets are typically not recorded for Special Revenue Funds.

Accepted Answer

A) True 
 B)False

Question 3

With respect to Debt Service Funds,which of the following is not correct?

Accepted Answer

A)  Typically, resources are provided through transfers from the General or other funds. 
B)  Encumbrances are recorded to reflect principal payments that are expected to come due within the current accounting period. 
C)  There are two types of debt service expenditures: interest and principal 
D)  In most cases, interest and principal payments are not recorded until payment is due. 
A)  Typically, resources are provided through transfers from the General or other funds. 
B)  Encumbrances are recorded to reflect principal payments that are expected to come due within the current accounting period. 
C)  There are two types of debt service expenditures: interest and principal 
D)  In most cases, interest and principal payments are not recorded until payment is due.

Question 4

Which of the following statements regarding serial bonds is false?

Accepted Answer

A)  The principal on serial bonds is paid over the term of the bonds. 
B)  The assets of a debt service fund may include Cash with Fiscal Agent 
C)  If the first payment is delayed for more than a year with equal payments thereafter, the bonds are deferred serial bonds 
D)  The principal repayment on an annuity serial bonds decreases each year as the outstanding balance decreases 
A)  The principal on serial bonds is paid over the term of the bonds. 
B)  The assets of a debt service fund may include Cash with Fiscal Agent 
C)  If the first payment is delayed for more than a year with equal payments thereafter, the bonds are deferred serial bonds 
D)  The principal repayment on an annuity serial bonds decreases each year as the outstanding balance decreases

Question 5

The City of Presho had the following transactions related to the construction of a new courthouse.
(a)1/2/2015:
 20 year 4% General Obligation Serial Bonds with a face value of $5,000,000 are issued at 102. Interest and principle payments are made on Jan.1 and July 1 of each year. The premium was transferred into the Debt Service Fund. The General Fund will fully fund each payment as they become due.
(b)3/1/2015:
 Land is purchased for a new courthouse at a cost of $ 300,000.
(c)3/1/2015:
 A contract is signed for construction of the new courthouse in the amount of $ 4,300,000.
(d)6/15/2015:
 Cash ($ 225,000)sufficient to cover interest and principal payments for the year less the premium is transferred from the General Fund.
(e)7/1/2015:
 Interest ($100,000)and principal ($125,000)are paid on the courthouse fund serial bonds.
(f)12/1/2015:
 Receive an invoice for progress completed to date on the courthouse construction project in the amount of $3,700,000.
(g)12/27/2015:
 $97,500 is transferred from the General Fund for the 1/1/2015 interest payment due on the courthouse fund serial bonds.Interest is accrued as of 12/31/2015,following the exception permitted by GASB.
Required:
 Prepare a Statement of Revenues,Expenditures and Changes in Fund Balance for the Capital Projects and Debt Service Funds. Assume this is the first year for each fund (beginning fund balances are zero)and the City has no other long-term debt than that described above. Use separate columns for the two funds

Accepted Answer

The answer of The City of Presho had the following...

Question 6

Which of the following is/are true regarding Capital Projects Funds?

Accepted Answer

A)  A major source of funding for capital projects funds is the issuance of long-term debt. 
B)  Capital project funds only exist for the duration of the project for which it is created. 
C)  Capital Project funds use the Modified Accrual Basis of Accounting. 
D)  All of the above are true. 
A)  A major source of funding for capital projects funds is the issuance of long-term debt. 
B)  Capital project funds only exist for the duration of the project for which it is created. 
C)  Capital Project funds use the Modified Accrual Basis of Accounting. 
D)  All of the above are true.

Question 7

Encumbrance accounting is only typically used for

Accepted Answer

A)  Permanent Funds. 
B)  Debt Service Funds. 
C)  Capital Projects Funds. 
D)  None of the above. 
A)  Permanent Funds. 
B)  Debt Service Funds. 
C)  Capital Projects Funds. 
D)  None of the above.

Question 8

The journal entry for the Debt Service fund upon the receipt of money from the General Fund would be:

Accepted Answer

A)  Debit to Cash and a credit to Transfers Payable. 
B)  Debit to Transfer In and credit to Cash. 
C)  Debit to Cash and credit to Transfer In. 
D)  Debit to Cash and credit to Transfer Out. 
A)  Debit to Cash and a credit to Transfers Payable. 
B)  Debit to Transfer In and credit to Cash. 
C)  Debit to Cash and credit to Transfer In. 
D)  Debit to Cash and credit to Transfer Out.

Question 9

Which of the following statements is false?

Accepted Answer

A)  The corpus (principal) from a permanent fund should be classified as Nonspendable. 
B)  Unexpended intergovernmental grants and taxes dedicated to capital improvements in a capital projects fund are likely to be classified as Assigned Fund Balance 
C)  The residual classification for funds other than the General Fund is Assigned. 
D)  If a bond sinking fund is required by creditors or law, the unexpended resources would be classified as Restricted. 
A)  The corpus (principal) from a permanent fund should be classified as Nonspendable. 
B)  Unexpended intergovernmental grants and taxes dedicated to capital improvements in a capital projects fund are likely to be classified as Assigned Fund Balance 
C)  The residual classification for funds other than the General Fund is Assigned. 
D)  If a bond sinking fund is required by creditors or law, the unexpended resources would be classified as Restricted.

Question 10

Which of the following statements is false?

Accepted Answer

A)  Resources representing supplies and prepaid items are classified in governmental funds as Nonspendable Fund balance. 
B)  Capital Projects, debt service and permanent funds do not typically record budgets. 
C)  Debt service and permanent funds do not record encumbrances. 
D)  Principal of permanent funds is classified as Committed Fund Balance 
A)  Resources representing supplies and prepaid items are classified in governmental funds as Nonspendable Fund balance. 
B)  Capital Projects, debt service and permanent funds do not typically record budgets. 
C)  Debt service and permanent funds do not record encumbrances. 
D)  Principal of permanent funds is classified as Committed Fund Balance

Question 11

If a government has debt service due no more than one month after the end of a fiscal year and has the resources available,then it is permitted to accrue expenditures and a fund liability for the debt service.

Accepted Answer

A) True 
 B)False

Question 12

Unexpended intergovernmental grants and taxes dedicated to capital improvements in a capital projects fund are likely to be classified as Committed Fund Balance

Accepted Answer

A) True 
 B)False

Question 13

The principal of permanent funds is classified as Nonspendable Fund Balance.

Accepted Answer

A) True 
 B)False

Question 14

Capital outlay expenditures of capital projects funds will typically result in additions to the general fixed assets reported in the governmental fund Balance Sheet.

Accepted Answer

A) True 
 B)False

Question 15

With respect to Debt Service Funds,which of the following is true?

Accepted Answer

A)  Payments under capital lease obligations may be reported in debt service funds 
B)  Debt service funds use accrual accounting 
C)  Each separate long-term obligation must be accounted for in a separate debt service fund 
D)  All of the above are true 
A)  Payments under capital lease obligations may be reported in debt service funds 
B)  Debt service funds use accrual accounting 
C)  Each separate long-term obligation must be accounted for in a separate debt service fund 
D)  All of the above are true

Question 16

A government entered into a capital lease agreement to acquire equipment for the general government on January 1, 2015. Five payments of $9,000 each are to be made, beginning on December 31, 2015. Discounting is at 6%, computed annually. The present value of the five payments is $37,911.
-Which of the following would be true as of January 1,2015?

Accepted Answer

A)  An entry would be made debiting Expenditures and crediting Other Financing Sources-Capital Leases in a governmental fund, both in the amount of $45,000. 
B)  An entry would be made debiting Equipment and crediting Capital Leases Payable in a governmental fund, both in the amount of $37,911. 
C)  An entry would be made debiting Capital Expenditure and crediting Capital Leases Payable in a governmental fund, both in the amount of $37,911. 
D)  An entry would be made debiting Expenditures and crediting Other Financing Sources-Capital Leases in a governmental fund, both in the amount of $37,911. 
A)  An entry would be made debiting Expenditures and crediting Other Financing Sources-Capital Leases in a governmental fund, both in the amount of $45,000. 
B)  An entry would be made debiting Equipment and crediting Capital Leases Payable in a governmental fund, both in the amount of $37,911. 
C)  An entry would be made debiting Capital Expenditure and crediting Capital Leases Payable in a governmental fund, both in the amount of $37,911. 
D)  An entry would be made debiting Expenditures and crediting Other Financing Sources-Capital Leases in a governmental fund, both in the amount of $37,911.

Question 17

Capital projects funds are always included in the Budgetary Comparison Schedule.

Accepted Answer

A) True 
 B)False

Question 18

Governmental funds,other than the General Fund,are considered major if:
I.Total Assets,Liabilities,Revenues,or Expenditures of that individual governmental fund are at least 10% of the corresponding total (assets,liabilities,and so forth)for all governmental funds.
II.Total Assets,Liabilities,Revenues,or Expenditures of the individual governmental fund are at least 5% of the corresponding total for all governmental and enterprise funds combined.

Accepted Answer

A)  I only. 
B)  II only. 
C)  Either I or II, but need not be both. 
D)  Both I and II. 
A)  I only. 
B)  II only. 
C)  Either I or II, but need not be both. 
D)  Both I and II.

Question 19

What is the difference between a current refunding and advance refunding?

Accepted Answer

Current refunding exists when new debt i

Question 20

Use the following to answer the next six questions:
During the fiscal year ended December 31, 2015, the City of Johnstown issued 6% general obligation serial bonds in the amount of $2,000,000 at 102 ($2,040,000) and used $1,980,000 of the proceeds to construct a fire station. The $40,000 premium was transferred to a debt service fund. The $20,000 left in the capital projects fund at the end of the project was later transferred to the debt service fund. The bonds were dated April 1, 2015 and paid interest on October 1 and April 1. The first of 10 equal annual principal payments was due on April 1, 2016.
-How would the $40,000 premium be accounted for?

Accepted Answer

A)  Amortized to interest expenditure in the debt service fund. 
B)  As an other financing source in the debt service fund. 
C)  Both (a) and (b) above. 
D)  None of the above. 
A)  Amortized to interest expenditure in the debt service fund. 
B)  As an other financing source in the debt service fund. 
C)  Both (a) and (b) above. 
D)  None of the above.

With respect to Capital Projects Funds,which of the following is correct?

Budgets are typically not recorded for Special Revenue Funds.

With respect to Debt Service Funds,which of the following is not correct?

Which of the following statements regarding serial bonds is false?

Which of the following is/are true regarding Capital Projects Funds?

Encumbrance accounting is only typically used for

The journal entry for the Debt Service fund upon the receipt of money from the General Fund would be:

Which of the following statements is false?

Which of the following statements is false?

If a government has debt service due no more than one month after the end of a fiscal year and has the resources available,then it is permitted to accrue expenditures and a fund liability for the debt service.

Unexpended intergovernmental grants and taxes dedicated to capital improvements in a capital projects fund are likely to be classified as Committed Fund Balance

The principal of permanent funds is classified as Nonspendable Fund Balance.

Capital outlay expenditures of capital projects funds will typically result in additions to the general fixed assets reported in the governmental fund Balance Sheet.

With respect to Debt Service Funds,which of the following is true?

Capital projects funds are always included in the Budgetary Comparison Schedule.

What is the difference between a current refunding and advance refunding?

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

Overview of Financial Reporting for State and Local Governments

Modified Accrual Accounting: Including the Role of Fund Balances and Budgetary Authority

Accounting for the General and Special Revenue Funds

Proprietary Funds

Fiduciary Funds, Inter-fund Transactions

Government-Wide Statements: Capital Assets; Long-Term Debt

Accounting for Special-Purpose Entities Including Public Colleges and Universities

Accounting for Private Not-For-Profit Organizations

College and University Accounting Private Institutions

Accounting for Hospitals and Other Health Care Providers

Auditing, Tax-Exempt Organizations, and Evaluating Performance

Financial Reporting by the Federal Government

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Exam 5: Accounting for Other Governmental Fund Types: Capital Projects, Debt Service, and Permanent

With respect to Capital Projects Funds,which of the following is correct?

Budgets are typically not recorded for Special Revenue Funds.

With respect to Debt Service Funds,which of the following is not correct?

Which of the following statements regarding serial bonds is false?

Which of the following is/are true regarding Capital Projects Funds?

Encumbrance accounting is only typically used for

The journal entry for the Debt Service fund upon the receipt of money from the General Fund would be:

Which of the following statements is false?

Which of the following statements is false?

If a government has debt service due no more than one month after the end of a fiscal year and has the resources available,then it is permitted to accrue expenditures and a fund liability for the debt service.

Unexpended intergovernmental grants and taxes dedicated to capital improvements in a capital projects fund are likely to be classified as Committed Fund Balance

The principal of permanent funds is classified as Nonspendable Fund Balance.

Capital outlay expenditures of capital projects funds will typically result in additions to the general fixed assets reported in the governmental fund Balance Sheet.

With respect to Debt Service Funds,which of the following is true?

Capital projects funds are always included in the Budgetary Comparison Schedule.

What is the difference between a current refunding and advance refunding?

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

Overview of Financial Reporting for State and Local Governments

Modified Accrual Accounting: Including the Role of Fund Balances and Budgetary Authority

Accounting for the General and Special Revenue Funds

Proprietary Funds

Fiduciary Funds, Inter-fund Transactions

Government-Wide Statements: Capital Assets; Long-Term Debt

Accounting for Special-Purpose Entities Including Public Colleges and Universities

Accounting for Private Not-For-Profit Organizations

College and University Accounting Private Institutions

Accounting for Hospitals and Other Health Care Providers

Auditing, Tax-Exempt Organizations, and Evaluating Performance

Financial Reporting by the Federal Government

Filters