Exam 17: Accounting for State and Local Governments

Marie Todd works for the City of Rochester and volunteered to work the New Years Eve holiday in December, 2010. In exchange for working the holiday, the city will grant her 2 vacation days compensated at $500 per day. Marie decided to take these vacation days during January, 2011. For Government-wide financial statements, what are the journal entries to record these events in 2010 and in 2011?

According to the GASB (Governmental Accounting Standards Board), which one of the following is not a criterion for determining whether a government is legally separate?

Which criteria must be met to be considered a special purpose government? (1) Have a separately elected governing body (2) Be legally independent (3) Be fiscally independent

For the purpose of government-wide financial statements, the cost of cleaning up a government-owned landfill and closing the landfill

For fund-based financial statements, what account is credited when a piece of equipment is leased on a capital lease?

The employees of the City of Raymond earn vacation compensation that totals $1,500 per week. During 2011, $30,000 in vacation time was taken and the remainder is expected to be used during the latter part of next year. In the government-wide financial statements, assuming there was no beginning balance, what liability should be reported at the end of 2011?

Which of the following is not a criterion of a capital lease?

Jones College, a public institution of higher education, must prepare financial statements

Drye Township has received a donation of a rare painting worth $1,000,000. For Drye's government-wide financial statements, three criteria must be met before Drye can opt not to recognize the painting as an asset. Which of the following is not one of the three criteria? (1) The painting is held for public exhibition, education, or research in furtherance of public service, rather than financial gain. (2) The painting is scheduled to be sold immediately at auction. (3) The painting is protected, kept unencumbered, cared for, and preserved.

A method of depreciation for infrastructure assets that allows the expensing of all maintenance costs each year instead of computing depreciation is called

The parking garage and parking lots owned by the city of Danton reported the following balances for 2011: Receipts from public users of the parking facilities \ 190,000 Receipts from the city for parking of city-owned vehicles 8,000 Salaries paid to employees 75,000 Printing - paid to an internal service fund 6,000 Interest on bonded indebtedness 10,000 Sculpture for entrance to parking lot (donated during 2011) 12,500 Depreciation on parking garage 30,000 Truck (purchased during 2011) 35,000 Maintenance - paid to an internal service fund 17,000 Required: What amount of net revenue (or expense) should be reported by the fund that was used to account for parking operations assuming the preparation of government-wide financial statements?

A city starts a solid waste landfill during 2010. When the landfill was opened the city estimated that it would fill to capacity within 5 years and that the cost to cover the facility would be $1.5 million which will not be paid until the facility is closed. At the end of 2010, the facility was 20% full, and at the end of 2011 the facility was 45% full. On government-wide financial statements, which of the following are the appropriate amounts to present in the financial statements for 2011?

For government-wide financial statements, what account is credited when a piece of equipment is leased on a capital lease?

The town of Wakefield opened a solid waste landfill in 2010 that was at 20% capacity on December 31, 2010 and at 50% capacity on December 31, 2011. The city initially anticipated closure costs of $2.3 million but in 2011 revised the estimate of the closure costs to be $2.7 million. None of these costs will be incurred until the landfill is scheduled to be closed. What is the journal entry that should be recorded on December 31, 2011 for Government-wide Financial Statements?

The Town of Portsmouth has at the beginning of the year a $213,000 Net Asset balance, and a $52,000 Fund Balance. The following information relates to the activities within the town of Portsmouth for the year of 2011. -Prepare a Statement of Revenues, Expenditures and Changes in Fund Balances.

GASB No. 34 makes which of the following statements regarding Management's Discussion and Analysis?

Which of the following is a section of the general purpose external financial statements of a state or local government? (1) Management's discussion and analysis (MD&A). (2) Required supplementary information (other than MD&A). (3) Basic financial statements and notes to financial statements.

The Town of Portsmouth has at the beginning of the year a $213,000 Net Asset balance, and a $52,000 Fund Balance. The following information relates to the activities within the town of Portsmouth for the year of 2011. -Prepare a Statement of Activities.

A local government's basic financial statements would include a statement of cash flows for all

A city starts a solid waste landfill during 2010. When the landfill was opened the city estimated that it would fill to capacity within 5 years and that the cost to cover the facility would be $1.5 million which will not be paid until the facility is closed. At the end of 2010, the facility was 20% full, and at the end of 2011 the facility was 45% full. If the landfill is judged to be a governmental fund, what liability is reported on the fund-based financial statements at the end of 2011?