Exam 16: Accounting for State and Local Governments

What is the primary difference between monies accounted for in the general fund and monies accounted for in the special revenue fund?

A new truck was ordered for the sanitation department at a cost of $122,200 on September 3, 2011. Required: (A) Prepare the required journal entry in the General Fund for the Fund-Based Financial Statements. (B) Prepare the required journal entry for the Government-Wide Financial Statements.

Which of the following is a fiduciary fund?

When a city received a private donation of $1,000,000 stipulating that the principal donation would be preserved but allowing the interest income to be spent on building a city park with access for disabled children, which fund should the money be recorded in?

A $910,000 bond was issued on October 1, 2011 to build a new road. The bonds carried a 6% interest rate and are due in 10 years. Required: (A) Prepare the required journal entry in the Capital Projects Fund on October 1 for the Fund-Based Financial Statements. (B) Prepare the required journal entry for the Government-Wide Financial Statements.

What is a special revenue fund used to account for?

On June 14, 2011, Fred City agreed to transfer cash of $52,000 from the General Fund to provide permanent financing for a municipal swimming pool that will be viewed as an Enterprise Fund. The cash was transferred on June 30. Required: (A) Prepare all the required journal entries and identify the fund in which each entry was recorded for the Fund-Based Financial Statements. (B) Prepare all the required journal entries and identify the type of activity for the Government-Wide Financial Statements.

On January 1, 2011, Wakefield City purchased $40,000 office supplies. During the year $35,000 of these supplies were used. Required: Record the journal entries for these transactions using the purchases method. (Disregard the encumbrance entries)

What are the broad types or classifications of funds for a governmental entity such as a city?

Which type of fund is not included in the Government-Wide Financial Statements?

What account is debited in the general fund when equipment is received by a governmental entity?

How do the balance sheet and statement of revenues, expenditures, and changes in fund balances of governmental funds differ from the financial statement presentation for the governmental activities in the government-wide statement of net assets and statement of activities? (1) Internal service funds are not included in the fund-based financial statements of governmental funds but could be reported in the governmental activities of government-wide financial statements. (2) The economic resources measurement basis is used for fund-based financial statements of governmental funds and the current financial resources measurement basis is used for governmental activities in the government-wide financial statements. (3) Modified accrual accounting is used for fund-based financial statements of governmental funds to time revenues and expenditures and accrual accounting is used for governmental activities of government-wide financial statements. (4) The financial statements of governmental funds for fund-based financial statements are the same as governmental activities in government-wide financial statements but with different titles of the financial statements.

Which statement is not correct?

A city received a grant of $5,000,000 from a private agency. The money was to be used to build a new city library. In which fund should the money be recorded for the Fund-Based Financial Statements?

Which standard issued by the Governmental Accounting Standards Board in 1999 requires two distinct sets of financial statements for state and local governments?

The reporting of the fund balance of governmental funds will result in a maximum of ___________ categories:

Which classifications may be not used for the Fund Balance of governmental funds?

A $5,000,000 bond is issued by Northern City to build a new hospital. Required: Prepare the journal entry and identify the fund in which it is recorded to reflect the bond issue.

A city operates a central data processing facility. The expenses of this facility would be accounted for using

On August 21, 2011, Fred City transferred $100,000 to the School System to cover repairs to a school building. Required: Prepare all the required journal entries and identify the fund in which each entry was recorded for the Fund-Based Financial Statements.