Question 1

Which of the following classifications is not used in the government-wide statement of activities?

Accepted Answer

Nonoperating revenues are not a classification used in the government-wide statement of activities; instead, the statement uses classifications like general revenues, extraordinary items, and transfers.

Question 2

The minimum requirements for general purpose external financial reporting does not include

Accepted Answer

While fund financial statements, management's discussion and analysis, and required supplementary information are all required components of general purpose external financial reporting, a transmittal letter is not a minimum requirement. However, a transmittal letter may be included in the reporting package as a way to provide context and highlight key points.

Question 3

Which governmental fund must always be reported in a separate column in the governmental fund financial statements?

Accepted Answer

The General Fund must always be reported in a separate column in the governmental fund financial statements because it is the chief operating fund of a government, accounting for all financial resources except those required to be accounted for in another fund.

Question 4

The government-wide statements include

Accepted Answer

The government-wide statements include the Statement of Activities, which reports the expenses, revenues, and changes in net position for the entire government, excluding fiduciary activities.

Question 5

The fund financial statements included in the basic financial statements include separate balance sheets (or statements of net position) for all of the following except

Accepted Answer

The fund financial statements included in the basic financial statements include separate balance sheets for governmental funds, proprietary funds, and fiduciary funds. Discretely presented component units are not included in the fund financial statements but are reported separately in the notes to the financial statements.

Question 6

In the government-wide statements, business-type activities include

Accepted Answer

Business-type activities in government-wide statements primarily include only Enterprise Fund operations. These are activities that the government operates in a manner similar to private businesses, where the costs of providing services to the public on a continuing basis are financed or recovered primarily through user charges.

Question 7

Governmental activities in the government-wide financial statements would potentially report the following equity classifications except

Accepted Answer

Government-wide financial statements report net position, not fund balances. Fund balances are reported in the governmental funds financial statements. The classifications of net position include restricted net position, unrestricted net position, and net investment in capital assets, but not restricted fund balance.

Question 8

Below is information on total assets for various funds of the City of Dublin (all amounts are in thousands of dollars).
 $$\begin{array} { | l | r | } 
\hline { \text { Fund } } &  { \text { Assets } } \
\hline \text { General } & \$ 1,300 \
\hline \text { Federal Grants Special Reverue } & 500 \
\hline \text { State Grants Special Reverule } & 200 \
\hline \text { City Hall Capital Projects } & 900 \
\hline \text { Debt Service } & 700 \
\hline \text { Water ard Sewer Enterprise } & 8,000 \
\hline \text { Swirninirig Pool Eriterprise } & 1,000 \
\hline \text { Fleet Maragernent Internal Service } & 10,800 \
\hline \text { Employee Pension Furd } & 6,500 \
\hline
\end{array}$$ Requirement: Prepare a schedule computing the threshold for asset amounts that should be used to determine which funds must be reported as major. Identify which funds are major funds.

Accepted Answer

The answer of   Below is information on total...

Question 9

When preparing external financial statements that are in accordance with generally accepted accounting principles, the minimum financial report will include

Accepted Answer

When preparing external financial statements in accordance with generally accepted accounting principles, the minimum financial report will include basic financial statements, management's discussion and analysis, and other required supplementary information. This is the standard requirement for financial reporting by government entities, as set forth by the Governmental Accounting Standards Board. Alternative options such as a comprehensive annual financial report or only the financial section of a comprehensive annual financial report are not sufficient to meet the minimum requirements of GAAP.

Question 10

The government-wide statement of net position would report the following component of net position except

Accepted Answer

The government-wide statement of net position reports Unrestricted net position, Restricted net position, and Net investment in capital assets. It does not include a category for Designated net position, as designations are typically decisions made internally by management and are not a required reporting category under GASB standards for government-wide financial statements.

Question 11

In the fund financial statements, a government should include a separate column for all of the following except

Accepted Answer

In the fund financial statements, governments are required to report major funds individually, with separate columns for each major fund. This includes major Enterprise Funds, Capital Projects Funds, and Permanent Funds. However, Internal Service Funds are typically not reported in separate columns unless they are deemed to be major, which is less common. The emphasis is usually on funds that are externally focused, such as Enterprise and Capital Projects Funds, or those with significant permanent endowments, like Permanent Funds.

Question 12

In the statement of activities, depreciation is reported on

Accepted Answer

Depreciation is reported on all depreciable capital assets of the government except for infrastructure assets that are being maintained using the modified approach, where such assets are not depreciated as their maintenance is ensured to keep them in essentially perpetual good condition.

Question 13

Which of the following may be reported in the government-wide statements and the fund financial statements?

Accepted Answer

The answer of Which of the following may be reported...

Question 14

In the proprietary fund statements, a government should include a separate column for

Accepted Answer

According to GASB, in the proprietary fund statements, a government should include a separate column for each major Enterprise Fund, nonmajor Enterprise Funds in the aggregate, Enterprise Funds total, and Internal Service Funds in the aggregate. The Proprietary Funds total is not required to be presented in a separate column but can be derived by adding the columns for Enterprise and Internal Service Funds. Therefore, Choice C is the best option as it includes all required columns.

Question 15

For general purpose external financial reporting, discretely presented component unit information

Accepted Answer

Discretely presented component unit information is included in the government-wide statements only, as it allows for a distinction between the primary government and its component units while still presenting a comprehensive financial picture.

Question 16

The following information was drawn from the records of Wise County (all amounts are in thousands of dollars).
$\begin{array}{llr}
  \text {Local gas tax restricted for street maintenance.  } &\$13,000\
 \text {State grant restricted for police training  } &4,000\
 \text {Federal grant for new library  } &1,222\
 \text { Gain on sale of general capital assets } &300\
 \text { License and permit fees } &70\
 \text { Interest collected on investments } &108\
  \text { Fines and forfeitures } &500\
 \text { Contributions to permanent fund which supports education } &635\
 \text {  Shared state revenues restricted to public health.} &1,100\
\end{array}$
 
$\underline{\text{ Requirement: }}$  Prepare schedules computing amounts to be reported as Charges for Services, Operating Grants and Contributions, Capital Grants and Contributions, and General Revenues.

Accepted Answer

The answer of  
The following information was drawn from...

Question 17

A budgetary comparison schedule is required for

Accepted Answer

The answer of A budgetary comparison schedule is required for
...

Question 18

Which financial statement may be presented as required supplementary information?

Accepted Answer

The General Fund and major Special Revenue Funds statement of revenues, expenditures, and changes in fund balances-budget and actual may be presented as required supplementary information according to Governmental Accounting Standards Board (GASB) standards. The other options listed may be presented as primary financial statements, but not as required supplementary information.

Question 19

The government-wide statement of net position must include a column for each of the following except

Accepted Answer

The government-wide statement of net position must include columns for governmental activities, business-type activities, and component units. Fiduciary activities are not included in the government-wide financial statements, as their assets and liabilities are held in a fiduciary capacity and are not assets and liabilities of the government itself.

Question 20

In the government-wide statement of net position, interfund receivables and payables

Accepted Answer

The answer of In the government-wide statement of net position,...

Quiz 13: Financial Reportingthe Basic Financial Statements and Required Supplementary Information