Exam 4: Accounting for the General and Special Revenue Funds

A transaction in which a government gives or receives value without directly receiving or giving equal value in exchange is known as a(n):

If invoices for items purchased total $200,000 and related purchase orders total $185,000, which of the following is correct?

When closing out the General Fund and Special Revenue Funds of a state or local governmental unit, the balance of the operating statement accounts and the balances of the budgetary accounts are closed to Fund Balance - Unreserved

The city of Canandaigua receives proceeds from the sale of land, the transaction is considered to be a special item. The proceeds are:

When establishing funds, governments should attempt to have a large number of special revenue and other funds to provide the user with enough detail to understand the transactions.

When the General Fund purchases water from an enterprise fund, the General Fund would debit Transfers Out.

The Debt Service Fund would record the receipt of money from the General Fund as other financing sources on the activities Statement of Revenues, Expenditures and Changes in Fund Balance.

Which of the following would not be a nonexchange transaction for a state government?

Sales taxes, income taxes and motor fuel taxes are examples of exchange transactions.

The GASB has created four "eligibility requirements" that must be met before revenue can be recognized: (1) required characteristics of recipients, (2) timing, (3) reimbursements and (4) contingencies.

Indicate which of the following use Modified Accrual Accounting? Capital Financial Projects Fund Statements A) Yes No B) No Yes C) Yes No D) Yes Yes Special Revenue Enterprise Fund Fund Yes No No Yes Yes Yes No No

When the invoice for materials and supplies ordered is received and is more than the related purchase order, this entry should be made:

In the General Fund, revenues are recognized when earned and measurable.

The General Fund of the City of Richmond approved a tax levy for the calendar year 2009 in the amount of $1,600,000. Of that amount, $30,000 is expected to be uncollectible. During 2009, $1,400,000 was collected. During 2010, $100,000 was collected during the first 30 days, $40,000 was collected during the next 30 days and $30,000 was collected during the next 30 days. During the postaudit, you discovered that the City showed $1,570,000 in revenues. What adjusting entry would you need to make, assuming you decided to allow the maximum amount of revenues for 2009, using modified accrual accounting?

Interfund services provided and used are recognized directly as Transfers In and Transfers Out.

Property Taxes, special assessments and fines and forfeits are types of nonexchange transactions and assets should be recognized when an enforceable legal claim exists or when the resources are received, which ever is first. These are examples of:

When accounting for the General Fund, the Encumbrances Control account is credited when:

What would be the effect on the Unreserved Fund Balance at the end of the current fiscal year of recording a $15,000 expenditure for a new computer, assuming a $14,600 encumbrance had been recorded in a General Fund department in the previous fiscal year?

GASB requires which of the following to be reported separately after other financing sources and uses in the Statement of Revenues, Expenditures and Changes in Fund Balance?

The City of Aurora increased its revenue budget by $50,000 and the appropriation for the Public Works Department was increased by $100,000. What is the journal entry to record this event in the General Fund? A) Estimated Revenues Control 50,000 Budgetary Fund Balance 50,000 Appropriations Control 100,000 B) Appropriations Control 100,000 Estimated Revenues Control 50,000 Budgetary Fund Balance 50,000 C) Estimated Revenues Control 50,000 Fund Balance-Unreserved 50,000 Appropriations Control 100,000 D) Estimated Revenues Control 50,000 Appropriations Control 100,000