Exam 8: Government-Wide Statements, Capital Assets, Long-Term Debt

The City of Charlotte levied property taxes in 2009 in the amount of $10 million. It is estimated that 2% will be uncollectible. During 2009, $9,000,000 was collected and it is anticipated that $400,000 will be collected during the next 60 days. When moving from the changes in fund balances in the Statement of Revenues, Expenditures and Changes in Fund Balances to the changes in net assets in the Statement of Activities, what will be the adjustment?

When preparing the General Fund financial statements, how much property tax revenue should be recognized for the year ended June 30, 2009?

When converting from fund basis reporting to government-wide reporting, which of the following would require an adjustment?

The Statement of Net Assets and Statement of Activities are the only two statements for the government-wide financial statements.

Which of the following would be considered a program revenue in the Statement of Activities of a local government?

Which of the following would be included in the Equity section of the Statement of Net Assets?

With regard to the government-wide statements, indicate the three categories of net assets that should be reported and describe what would be put into each category.

A government reported an other financing source in the amount of $600,000 related to the sale of land in its governmental funds Statement of Revenues, Expenditures and Changes in Fund Balances. The land had a cost of $170,000. The amount that would be reported in the government-wide Statement of Activities would be:

GASB requires a reconciliation from fund financial statements to government-wide financial statements.

When using the modified approach to account for infrastructures, expenditures to extend the life of the infrastructure assets are capitalized.

When using the modified approach to account for infrastructures, expenditures to extend the life of the infrastructure assets are:

The City of Thomasville maintains its books so as to prepare fund accounting statements and prepares worksheet adjustments in order to prepare government-wide financial statements. Required: You are to prepare, in journal form, worksheet adjustments for each of the following situations. A. General fixed assets, as of the beginning of the year, which had not been recorded, were as follows: Land \ 10,000,000 Buildings 605,000,000 Improvements other than buildings 210,000,000 Equipment 95,000,000 Accumulated depreciation, capital assets 182,100,000 B. During the year, expenditures for capital outlays amounted to $10,600,000. Of that amount, $7,500,000 was for buildings; $1,250,000 was for improvements other than buildings and the remainder was for land. C. The capital outlay expenditures outlined in (B) were completed at the end of the year (no depreciation until next year). For purposes of financial statement presentation, all capital assets are depreciated using the straight-line method, with no estimated salvage value. Estimated lives are as follows: buildings, 50 years; improvements other than buildings, 20 years; equipment, 10 years. D. Equipment with a cost of $ 36,500 and accumulated depreciation at the time of sale of $14,600 was sold for $41,000.

A donated collection is not required to be capitalized. If a government decides not to capitalize them, how will they be accounted for at the time of the donation?

The City of Brownsville maintains its books so as to prepare fund accounting statements and prepares worksheet adjustments in order to prepare government-wide statements. As such, the City's internal service fund, a print shop fund is included in the proprietary funds statements. Required: Prepare necessary adjustments in order to incorporate the internal service fund in the government-wide statements as a part of governmental activities: A. Balance sheet accounts include: Cash, $100,000; Inventories, $400,000; Capital Assets, $1,000,000; Accumulated Depreciation, $500,000; Accounts Payable, $150,000; Bonds Payable, $500,000, Net Assets, $350,000. B. The only transaction in the internal service fund that is external to the government is interest income in the amount of $15,000. C. Exclusive of the interest expense, the internal service fund reported net income of $48,000. An examination of the records indicates that services were provided as follows: one half to general government, one fourth to public safety, one fourth to culture and recreation.

Which of the following is true regarding revenue recognition for property taxes, when reporting in the government-wide statements?

Worksheet entries are not posted to the general journal.

A governmental funds Statement of Revenues, Expenditures and Changes in Fund Balances reported expenditures of $40 million, including capital outlay expenditures of $11 million. Capital assets for that government cost $80 million, including land in the amount of $10 million. Depreciable assets are amortized over 10 years, on average. The reconciliation from governmental fund changes in fund balances to governmental activities change in net assets would reflect a(an):

In its Statement of Net Assets, a government reported: Assets of $90 million, including $30 million in capital assets (net) and liabilities of $50 million, including long-term debt of $15 million, all related to capital asset acquisition. The government also reported $5 million of net assets were restricted for payment of debt service. The government's unrestricted net assets would be reported as:

When using the modified approach to record infrastructure, expenditures to widen a 2-lane road to 4-lanes would be charged to an expense, in lieu of depreciation.

When converting to government-wide financial statements, the entry to record the amortization of the premium on a bond would look like: