Question 1

On the due date for bond interest,the debt service fund journal entry (or entries)will include a debit to:

Accepted Answer

A)  Expenditures-Bond Interest. 
B)  Interfund Transfers In. 
C)  Appropriations. 
D)  Interest Expense. 
A)  Expenditures-Bond Interest. 
B)  Interfund Transfers In. 
C)  Appropriations. 
D)  Interest Expense.

Question 2

Debt margin is the difference between the debt limit and the amount of outstanding debt subject to the debt limitation.

Accepted Answer

A) True 
 B)False

Question 3

When Sunny City makes its annual lease payment on an unpaid capital lease obligation,the journal entry for the governmental activities accounts will include:

Accepted Answer

A)  A debit to Capital Lease Obligation Payable. 
B)  A credit to Capital Lease Obligation Payable. 
C)  A debit to Capital Lease Expense. 
D)  A debit to Expenditures-Principal of Capital Lease Obligation. 
A)  A debit to Capital Lease Obligation Payable. 
B)  A credit to Capital Lease Obligation Payable. 
C)  A debit to Capital Lease Expense. 
D)  A debit to Expenditures-Principal of Capital Lease Obligation.

Question 4

Governmental fund liabilities and expenditures for debt service on general long-term debt are generally recognized in the reporting period that debt payments are due.

Accepted Answer

A) True 
 B)False

Question 5

The debt service activity of a government may be accounted for within the General Fund unless law mandates the use of a debt service fund.

Accepted Answer

A) True 
 B)False

Question 6

The liability for special assessment bonds that carry a secondary pledge of a city's general credit should be reported in the balance sheet(s)of:

Accepted Answer

A)  A debt service fund. 
B)  An agency fund. 
C)  The governmental activities accounts. 
D)  An agency fund and disclosed in the notes to the financial statements. 
A)  A debt service fund. 
B)  An agency fund. 
C)  The governmental activities accounts. 
D)  An agency fund and disclosed in the notes to the financial statements.

Question 7

A given parcel of real estate may be subject at a given time to assessments for the payment of taxes to retire bonds issued by two or more governments.

Accepted Answer

A) True 
 B)False

Question 8

When a capital lease payment is legally due,an entry is made in the debt service (or appropriate governmental)fund to record an expenditure,and an entry is made in the governmental activities accounts to reduce Capital Lease Obligations Payable.

Accepted Answer

A) True 
 B)False

Question 9

Term bond issues mature in installments.

Accepted Answer

A) True 
 B)False

Question 10

Debt margin is a term used to denote the total amount of indebtedness of specified kinds that is allowed by law to be outstanding at any one time,while debt limit is the difference between the debt margin and the amount of outstanding debt subject to the debt limitation.

Accepted Answer

A) True 
 B)False

Question 11

The General Fund of the City of Castle Rock transfers $115,000 to the debt service fund for a $100,000 bond principal and $15,000 interest payment.Subsequent payment of the principal and interest would include:

Accepted Answer

A)  A debit to Expenditures - Bond Interest in the debt service fund. 
B)  A debit to Other Financing Uses - Principal and Interest Payments in the debt service fund. 
C)  A debit to Interest Expenditures in the General Fund. 
D)  A debit to Interest Expenditures in the governmental activities accounts. 
A)  A debit to Expenditures - Bond Interest in the debt service fund. 
B)  A debit to Other Financing Uses - Principal and Interest Payments in the debt service fund. 
C)  A debit to Interest Expenditures in the General Fund. 
D)  A debit to Interest Expenditures in the governmental activities accounts.

Question 12

Compensated absences,pollution remediation obligations,and claims and judgments are examples of long-term liabilities that can arise from operating activities.

Accepted Answer

A) True 
 B)False

On the due date for bond interest,the debt service fund journal entry (or entries)will include a debit to:

Debt margin is the difference between the debt limit and the amount of outstanding debt subject to the debt limitation.

When Sunny City makes its annual lease payment on an unpaid capital lease obligation,the journal entry for the governmental activities accounts will include:

Governmental fund liabilities and expenditures for debt service on general long-term debt are generally recognized in the reporting period that debt payments are due.

The debt service activity of a government may be accounted for within the General Fund unless law mandates the use of a debt service fund.

The liability for special assessment bonds that carry a secondary pledge of a city's general credit should be reported in the balance sheet(s)of:

A given parcel of real estate may be subject at a given time to assessments for the payment of taxes to retire bonds issued by two or more governments.

When a capital lease payment is legally due,an entry is made in the debt service (or appropriate governmental)fund to record an expenditure,and an entry is made in the governmental activities accounts to reduce Capital Lease Obligations Payable.

Term bond issues mature in installments.

Debt margin is a term used to denote the total amount of indebtedness of specified kinds that is allowed by law to be outstanding at any one time,while debt limit is the difference between the debt margin and the amount of outstanding debt subject to the debt limitation.

The General Fund of the City of Castle Rock transfers $115,000 to the debt service fund for a $100,000 bond principal and $15,000 interest payment.Subsequent payment of the principal and interest would include:

Compensated absences,pollution remediation obligations,and claims and judgments are examples of long-term liabilities that can arise from operating activities.

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 Activitiesillustrative Transactions and Financial Statements

Accounting for General Capital Assets and Capital Projects

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

Accounting for Fiduciary Activitiesagency 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 Organizationsregulatory, Taxation, and Performance Issues

Accounting for Colleges and Universities

Accounting for Health Care Organizations

Accounting and Reporting for the Federal Government Glossary

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Exam 6: Accounting for General Long-Term Liabilities and Debt Service

On the due date for bond interest,the debt service fund journal entry (or entries)will include a debit to:

Debt margin is the difference between the debt limit and the amount of outstanding debt subject to the debt limitation.

When Sunny City makes its annual lease payment on an unpaid capital lease obligation,the journal entry for the governmental activities accounts will include:

Governmental fund liabilities and expenditures for debt service on general long-term debt are generally recognized in the reporting period that debt payments are due.

The debt service activity of a government may be accounted for within the General Fund unless law mandates the use of a debt service fund.

The liability for special assessment bonds that carry a secondary pledge of a city's general credit should be reported in the balance sheet(s)of:

A given parcel of real estate may be subject at a given time to assessments for the payment of taxes to retire bonds issued by two or more governments.

When a capital lease payment is legally due,an entry is made in the debt service (or appropriate governmental)fund to record an expenditure,and an entry is made in the governmental activities accounts to reduce Capital Lease Obligations Payable.

Term bond issues mature in installments.

Debt margin is a term used to denote the total amount of indebtedness of specified kinds that is allowed by law to be outstanding at any one time,while debt limit is the difference between the debt margin and the amount of outstanding debt subject to the debt limitation.

The General Fund of the City of Castle Rock transfers $115,000 to the debt service fund for a $100,000 bond principal and $15,000 interest payment.Subsequent payment of the principal and interest would include:

Compensated absences,pollution remediation obligations,and claims and judgments are examples of long-term liabilities that can arise from operating activities.

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 Activitiesillustrative Transactions and Financial Statements

Accounting for General Capital Assets and Capital Projects

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

Accounting for Fiduciary Activitiesagency 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 Organizationsregulatory, Taxation, and Performance Issues

Accounting for Colleges and Universities

Accounting for Health Care Organizations

Accounting and Reporting for the Federal Government Glossary

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