Question 1

An enterprise fund should be used when debt is back solely by fees and charges

Accepted Answer

A) True 
 B)False

Question 2

Long term debt serviced from proprietary funds is reported only in the government-wide Statement of Net Position.

Accepted Answer

A) True 
 B)False

Question 3

Proprietary funds report using the economic resources measurement focus and the accrual basis of accounting.

Accepted Answer

A) True 
 B)False

Question 4

GASB Cash Flow Statements require the following classification of cash flows: Operating, Investing, and Financing.

Accepted Answer

A) True 
 B)False

Question 5

Which of the funds listed below would include capital assets in its Statement of Net Position?

Accepted Answer

A)  Permanent. 
B)  Special Revenue. 
C)  Internal Service. 
D)  None of the above; no funds in governmental accounting have capital asset accounts. 
A)  Permanent. 
B)  Special Revenue. 
C)  Internal Service. 
D)  None of the above; no funds in governmental accounting have capital asset accounts.

Question 6

Which of the following would not  be true regarding internal service funds?

Accepted Answer

A)  Internal service funds use the economic resources measurement focus and accrual basis of accounting. 
B)  Examples of internal service funds would include self-insurance funds, motor pool funds, and print shop funds. 
C)  In the basic financial statements, internal service funds are reported in the proprietary funds financial statements. 
D)  None of the above; all are true. 
A)  Internal service funds use the economic resources measurement focus and accrual basis of accounting. 
B)  Examples of internal service funds would include self-insurance funds, motor pool funds, and print shop funds. 
C)  In the basic financial statements, internal service funds are reported in the proprietary funds financial statements. 
D)  None of the above; all are true.

Question 7

Enterprise funds use the economic resources measurement focus and accrual basis of accounting

Accepted Answer

A) True 
 B)False

Question 8

Which of the following is not correct regarding the GASB Cash Flow Statement?

Accepted Answer

A)  The reconciliation of income and cash flows from operations starts with operating income. 
B)  Fixed Assets acquisitions are reported in the Capital and Related Financing Section. 
C)  Cash received from Interest and Dividend Income is recorded in the Operating Section. 
D)  All of the above are correct. 
A)  The reconciliation of income and cash flows from operations starts with operating income. 
B)  Fixed Assets acquisitions are reported in the Capital and Related Financing Section. 
C)  Cash received from Interest and Dividend Income is recorded in the Operating Section. 
D)  All of the above are correct.

Question 9

Which of the following is not correct with respect to proprietary funds?

Accepted Answer

A)  Proprietary funds are used to account for activities similar to those often engaged in by commercial businesses. 
B)  Users of goods or services are charged amounts at least sufficient to cover the costs of providing the goods or services. Thus, in the pure case, proprietary funds are self-supporting. 
C)  Budgets may be prepared for proprietary funds to facilitate management of fund activities, but GASB standards do not require budget-actual reporting. 
D)  Proprietary funds record only current financial resources and liabilities that will be settled with current financial resources. 
A)  Proprietary funds are used to account for activities similar to those often engaged in by commercial businesses. 
B)  Users of goods or services are charged amounts at least sufficient to cover the costs of providing the goods or services. Thus, in the pure case, proprietary funds are self-supporting. 
C)  Budgets may be prepared for proprietary funds to facilitate management of fund activities, but GASB standards do not require budget-actual reporting. 
D)  Proprietary funds record only current financial resources and liabilities that will be settled with current financial resources.

Question 10

Enterprise funds are used to account for activities similar to those engaged in profit-seeking businesses.

Accepted Answer

A) True 
 B)False

Question 11

What is the appropriate accounting for the signing of a contract to build a new water treatment facility by an Enterprise Fund?

Accepted Answer

A)  Debit Encumbrances. 
B)  Credit Budgetary Fund Balance - Reserve for encumbrances. 
C)  Both A & B. 
D)  No entry is required. 
A)  Debit Encumbrances. 
B)  Credit Budgetary Fund Balance - Reserve for encumbrances. 
C)  Both A & B. 
D)  No entry is required.

Question 12

Which of the following is not  true regarding enterprise funds?

Accepted Answer

A)  Similar to commercial businesses, enterprise funds equity accounts include both contributed capital and retained earnings. 
B)  A Statement of Revenues, Expenses, and Changes in Fund Net Position would be the primary operating statement for enterprise funds. 
C)  Enterprise funds' Cash Flow Statements could have up to four categories. 
D)  None of the above; all are true. 
A)  Similar to commercial businesses, enterprise funds equity accounts include both contributed capital and retained earnings. 
B)  A Statement of Revenues, Expenses, and Changes in Fund Net Position would be the primary operating statement for enterprise funds. 
C)  Enterprise funds' Cash Flow Statements could have up to four categories. 
D)  None of the above; all are true.

Question 13

The required financial statements of proprietary funds include a Statement of Net Position, a Statement of Revenues, Expenses, and Changes in Fund Net Position. The Statement of Cash Flows is recommended, but not required.

Accepted Answer

A) True 
 B)False

Question 14

Impact fees imposed on commercial developers by an enterprise fund and GASB requires enterprise associated with specific projects or improvements are recorded as:

Accepted Answer

A)  Capital contributions to the enterprise fund. 
B)  Operating revenues to the enterprise fund. 
C)  Unearned revenue to the enterprise fund. 
D)  Transfers from the enterprise fund to a capital projects fund. 
A)  Capital contributions to the enterprise fund. 
B)  Operating revenues to the enterprise fund. 
C)  Unearned revenue to the enterprise fund. 
D)  Transfers from the enterprise fund to a capital projects fund.

Question 15

An internal service fund provided services to a General Fund department. At the time of billing, the credit entry in the internal service fund would be:

Accepted Answer

A)  Operating Revenues-Charges for Sales and Services. 
B)  Other Financing Sources-Charges for Services. 
C)  Due from General Fund. 
D)  Other Financing Sources-Transfers In. 
A)  Operating Revenues-Charges for Sales and Services. 
B)  Other Financing Sources-Charges for Services. 
C)  Due from General Fund. 
D)  Other Financing Sources-Transfers In.

Question 16

Internal service and enterprise funds are both proprietary funds. Which of the following statements is correct?

Accepted Answer

A)  They both use the economic resource focus and accrual accounting 
B)  Enterprise funds are used to report on activities that provide goods and services to other funds, departments who are charged on a cost-reimbursement basis. 
C)  Enterprise funds are appropriate when the predominant user of goods and services is the government. 
D)  Depreciation is not recorded in proprietary funds 
A)  They both use the economic resource focus and accrual accounting 
B)  Enterprise funds are used to report on activities that provide goods and services to other funds, departments who are charged on a cost-reimbursement basis. 
C)  Enterprise funds are appropriate when the predominant user of goods and services is the government. 
D)  Depreciation is not recorded in proprietary funds

Question 17

Internal service funds account for

Accepted Answer

A)  Activities that produce goods or services to be provided to other governmental units on a cost reimbursement basis. 
B)  Activities that produce goods or services to be provided to outside consumers units on a cost reimbursement basis. 
C)  Both A and B. 
D)  None of the above. 
A)  Activities that produce goods or services to be provided to other governmental units on a cost reimbursement basis. 
B)  Activities that produce goods or services to be provided to outside consumers units on a cost reimbursement basis. 
C)  Both A and B. 
D)  None of the above.

Question 18

Financial statements for proprietary funds are prepared using the economic resources measurement focus.

Accepted Answer

A) True 
 B)False

Question 19

Proprietary funds use the economic resources measurement focus and modified accrual basis of accounting.

Accepted Answer

A) True 
 B)False

Question 20

Revenue bonds sold by a water utility fund, upon sale, would be recorded:

Accepted Answer

A)  In an enterprise fund as "Other Financing Source." 
B)  In the general long-term debt accounts as a liability. 
C)  In an enterprise fund as a liability. 
D)  In an enterprise fund as an addition to Net Position. 
A)  In an enterprise fund as "Other Financing Source." 
B)  In the general long-term debt accounts as a liability. 
C)  In an enterprise fund as a liability. 
D)  In an enterprise fund as an addition to Net Position.

An enterprise fund should be used when debt is back solely by fees and charges

Long term debt serviced from proprietary funds is reported only in the government-wide Statement of Net Position.

Proprietary funds report using the economic resources measurement focus and the accrual basis of accounting.

GASB Cash Flow Statements require the following classification of cash flows: Operating, Investing, and Financing.

Which of the funds listed below would include capital assets in its Statement of Net Position?

Which of the following would not be true regarding internal service funds?

Enterprise funds use the economic resources measurement focus and accrual basis of accounting

Which of the following is not correct regarding the GASB Cash Flow Statement?

Which of the following is not correct with respect to proprietary funds?

Enterprise funds are used to account for activities similar to those engaged in profit-seeking businesses.

What is the appropriate accounting for the signing of a contract to build a new water treatment facility by an Enterprise Fund?

Which of the following is not true regarding enterprise funds?

The required financial statements of proprietary funds include a Statement of Net Position, a Statement of Revenues, Expenses, and Changes in Fund Net Position. The Statement of Cash Flows is recommended, but not required.

Impact fees imposed on commercial developers by an enterprise fund and GASB requires enterprise associated with specific projects or improvements are recorded as:

An internal service fund provided services to a General Fund department. At the time of billing, the credit entry in the internal service fund would be:

Internal service and enterprise funds are both proprietary funds. Which of the following statements is correct?

Internal service funds account for

Financial statements for proprietary funds are prepared using the economic resources measurement focus.

Proprietary funds use the economic resources measurement focus and modified accrual basis of accounting.

Revenue bonds sold by a water utility fund, upon sale, would be recorded:

Introduction to Accounting and Financial Reporting for Governmental and Not-For-Profit Organizations

Overview of Financial Reporting for State and Local Governments

Modified Accrual Accounting: Including the Role of Fund Balances and Budgetary Authority

Accounting for the General and Special Revenue Funds

Accounting for Other Governmental Fund Types: Capital Projects, Debt Service, and Permanent

Fiduciary Funds, Interfund Transactions

Government-Wide Statements: Capital Assets; Long-Term Debt

Advanced Topics for State and Local Governments

Accounting for Private Not-For-Profit Organizations

College and University Accounting

Accounting for Hospitals and Other Health Care Providers

Auditing, Tax-exempt Organizations, and Evaluating Performance

Financial Reporting by the Federal Government

Filters

Exam 6: Proprietary Funds

An enterprise fund should be used when debt is back solely by fees and charges

Long term debt serviced from proprietary funds is reported only in the government-wide Statement of Net Position.

Proprietary funds report using the economic resources measurement focus and the accrual basis of accounting.

GASB Cash Flow Statements require the following classification of cash flows: Operating, Investing, and Financing.

Which of the funds listed below would include capital assets in its Statement of Net Position?

Which of the following would not be true regarding internal service funds?

Enterprise funds use the economic resources measurement focus and accrual basis of accounting

Which of the following is not correct regarding the GASB Cash Flow Statement?

Which of the following is not correct with respect to proprietary funds?

Enterprise funds are used to account for activities similar to those engaged in profit-seeking businesses.

What is the appropriate accounting for the signing of a contract to build a new water treatment facility by an Enterprise Fund?

Which of the following is not true regarding enterprise funds?

The required financial statements of proprietary funds include a Statement of Net Position, a Statement of Revenues, Expenses, and Changes in Fund Net Position. The Statement of Cash Flows is recommended, but not required.

Impact fees imposed on commercial developers by an enterprise fund and GASB requires enterprise associated with specific projects or improvements are recorded as:

An internal service fund provided services to a General Fund department. At the time of billing, the credit entry in the internal service fund would be:

Internal service and enterprise funds are both proprietary funds. Which of the following statements is correct?

Internal service funds account for

Financial statements for proprietary funds are prepared using the economic resources measurement focus.

Proprietary funds use the economic resources measurement focus and modified accrual basis of accounting.

Revenue bonds sold by a water utility fund, upon sale, would be recorded:

Introduction to Accounting and Financial Reporting for Governmental and Not-For-Profit Organizations

Overview of Financial Reporting for State and Local Governments

Modified Accrual Accounting: Including the Role of Fund Balances and Budgetary Authority

Accounting for the General and Special Revenue Funds

Accounting for Other Governmental Fund Types: Capital Projects, Debt Service, and Permanent

Fiduciary Funds, Interfund Transactions

Government-Wide Statements: Capital Assets; Long-Term Debt

Advanced Topics for State and Local Governments

Accounting for Private Not-For-Profit Organizations

College and University Accounting

Accounting for Hospitals and Other Health Care Providers

Auditing, Tax-exempt Organizations, and Evaluating Performance

Financial Reporting by the Federal Government

Filters