Question 1

Property taxes due 75 days after the end of the 2014 fiscal year would be recognized in 2014 as revenues in the General Fund general journal.

Accepted Answer

A) True 
 B)False

Question 2

The earnings on the assets of a permanent fund are to be used to support the city's library (special revenue fund).How would the earnings be recorded?

Accepted Answer

A)  Revenues by the permanent fund. 
B)  Revenues by the library. 
C)  Revenues by both the permanent fund and the library. 
D)  Other financing source by the permanent fund.

Question 3

At the end of the 2014 fiscal year the General Fund had $500 in encumbrances that remained opened into fiscal year 2015.In 2015 the encumbered goods were received at an invoiced cost of $520.How much would be recorded as the 2015 expenditure?

Accepted Answer

A)  $0. 
B)  $20. 
C)  $500. 
D)  $520.

Question 4

The Revenues account of a government is debited when

Accepted Answer

A)  The budget is recorded at the beginning of the year. 
B)  Property taxes are recorded. 
C)  The account is closed to fund balance-unassigned at the end of the year. 
D)  Property taxes are collected.

Question 5

The General Fund used electricity provided by the city-owned electric utility (an enterprise fund of the city).The governmental activities journal entry to record the transaction will include

Accepted Answer

A)  A debit to Expenses. 
B)  A debit to Expenditures. 
C)  A debit to Internal Balances. 
D)  No entry would be recorded since the transaction is between two funds of the same government.

Question 6

Which of the following financial statement(s)reports both current and noncurrent assets and liabilities?

Accepted Answer

A)  Choice A 
B)  Choice B 
C)  Choice C 
D)  Choice D

Question 7

The General Fund used electricity provided by the city-owned electric utility (an enterprise fund of the city).The General Fund general journal entry to record the transaction will include

Accepted Answer

A)  A debit to Expenses. 
B)  A debit to Expenditures. 
C)  A debit to Interfund Transfers Out. 
D)  A debit to Due to Other Funds.

Question 8

The General Fund received $200,000 in lieu of taxes from the city owned water utility,an enterprise fund.This is an example of a(an)

Accepted Answer

A)  Interfund transfer. 
B)  Interfund loan. 
C)  Internal exchange transaction. 
D)  Reimbursement.

Question 9

Permanent funds use the modified accrual basis of accounting.

Accepted Answer

A) True 
 B)False

Question 10

Estimated uncollectible tax amounts are recorded in the General Fund general journal as a reduction in revenues and in the governmental activities journal as a bad debt expense.

Accepted Answer

A) True 
 B)False

Question 11

Which of the following is properly reported as an other financing source by the General Fund?

Accepted Answer

A)  Sales taxes. 
B)  Interfund transfers in. 
C)  Parking fines. 
D)  Sale of zoning maps.

Question 12

When an enterprise fund pays the General Fund an amount in lieu of taxes,the account to be credited in the General Fund is

Accepted Answer

A)  Cash. 
B)  Operating Transfer in. 
C)  Revenues. 
D)  Fund Balance--Unassigned.

Question 13

At the end of the fiscal year,the purchases method of recording inventory adjusts the Expenditures account to reflect the amount of inventory actually used during the period.

Accepted Answer

A) True 
 B)False

Question 14

When a computer is ordered by a department of the government,the purchase order should be recorded in the General Fund as a debit to

Accepted Answer

A)  Appropriations. 
B)  Equipment. 
C)  Encumbrances. 
D)  Expenditures.

Question 15

Which of the following types of nonexchange transactions recognize revenue when all the eligibility requirements are met?

Accepted Answer

A)  Voluntary nonexchange transactions. 
B)  Imposed nonexchange transactions. 
C)  Derived tax revenues. 
D)  Property tax revenues.

Question 16

Generally,encumbrance accounting is not used in the accounting for payroll.

Accepted Answer

A) True 
 B)False

Question 17

Which of the following transactions is classified as an exchange transaction rather than a nonexchange transaction?

Accepted Answer

A)  Property taxes. 
B)  Fees charged by a municipal airport. 
C)  Bequest left to the city by a wealthy citizen. 
D)  State grant to conduct an after school program for children.

Question 18

Governments that are temporarily short of cash but that have levied taxes expected to be collectible during the fiscal year are generally able to borrow on short-term notes known as "tax anticipation notes payable."

Accepted Answer

A) True 
 B)False

Question 19

Distinguish between interfund loans and interfund transactions that recognize a flow of financial resources in governmental fund operating statements.

Accepted Answer

The answer of Distinguish between interfund loans and interfund transactions...

Question 20

An interfund transfer occurs when one fund of government pays another fund of the same government for services provided.

Accepted Answer

A) True 
 B)False

Exam 4: Accounting for Governmental Operating Activities-Illustrative Transactions and Financial Statements

Property taxes due 75 days after the end of the 2014 fiscal year would be recognized in 2014 as revenues in the General Fund general journal.

The earnings on the assets of a permanent fund are to be used to support the city's library (special revenue fund) .How would the earnings be recorded?

At the end of the 2014 fiscal year the General Fund had $500 in encumbrances that remained opened into fiscal year 2015.In 2015 the encumbered goods were received at an invoiced cost of $520.How much would be recorded as the 2015 expenditure?

The Revenues account of a government is debited when

The General Fund used electricity provided by the city-owned electric utility (an enterprise fund of the city) .The governmental activities journal entry to record the transaction will include

Which of the following financial statement(s) reports both current and noncurrent assets and liabilities?

The General Fund used electricity provided by the city-owned electric utility (an enterprise fund of the city) .The General Fund general journal entry to record the transaction will include

The General Fund received $200,000 in lieu of taxes from the city owned water utility,an enterprise fund.This is an example of a(an)

Permanent funds use the modified accrual basis of accounting.

Estimated uncollectible tax amounts are recorded in the General Fund general journal as a reduction in revenues and in the governmental activities journal as a bad debt expense.

Which of the following is properly reported as an other financing source by the General Fund?

When an enterprise fund pays the General Fund an amount in lieu of taxes,the account to be credited in the General Fund is

At the end of the fiscal year,the purchases method of recording inventory adjusts the Expenditures account to reflect the amount of inventory actually used during the period.

When a computer is ordered by a department of the government,the purchase order should be recorded in the General Fund as a debit to

Which of the following types of nonexchange transactions recognize revenue when all the eligibility requirements are met?

Generally,encumbrance accounting is not used in the accounting for payroll.

Which of the following transactions is classified as an exchange transaction rather than a nonexchange transaction?

Governments that are temporarily short of cash but that have levied taxes expected to be collectible during the fiscal year are generally able to borrow on short-term notes known as "tax anticipation notes payable."

Distinguish between interfund loans and interfund transactions that recognize a flow of financial resources in governmental fund operating statements.

An interfund transfer occurs when one fund of government pays another fund of the same government for services provided.