Question 1

A county enacted a special tax levy and the money must be used to buy unused farmland for environmental preservation.What kind of fund should be used to record the revenues generated by the tax?

Accepted Answer

The answer of A county enacted a special tax levy...

Question 2

The government has just voted to repair the parking garages to all federal building and estimate the cost to be $750,000.The government discloses this decision by debiting which account?
A) Committed
B) Nonspendable
C) Assigned
D) Unassigned
E) Restricted

Accepted Answer

The government would debit the "Committed" account because the funds are set aside for a specific purpose, which is the repair of parking garages.

Question 3

What are the two proprietary fund types?

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The answer of What are the two proprietary fund types?...

Question 4

Under modified accrual accounting, when are expenditures recorded?

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Question 5

Which organization is responsible for establishing accounting principles for governmental entities? By whom was this organization established?

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Question 6

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

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Question 7

When should property taxes be recognized under modified accrual accounting?

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Question 8

What is the definition of the term fund?

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Question 9

For a government, what kinds of operations are accounted for using a proprietary fund? Give three examples.

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Question 10

For each of the following transactions, select the area of accounting records in which an entry will be recorded for governmental fund financial statements and for government-wide financial statements.
(A) General fund only.
(B) Governmental activities only.
(C) General fund and Governmental activities.
(D) General fund and Debt service fund.
(E) Capital projects fund and Governmental activities.
(F) Debt service fund and Governmental activities.
(G) Special revenue fund and Governmental activities.
___ (1.) The city council adopts an annual budget for the general fund.
___ (2.) Property taxes are levied.
___ (3.) Computers are ordered for the fire department.
___ (4.) A transfer of funds is made from the general fund to the debt service fund.
___ (5.) The principal and interest of a bond are paid.
___ (6.) A building is acquired for the police department, and renovations begin immediately.
___ (7.) Depreciation on fire trucks is recorded.
___ (8.) Citizens are assessed for a street lighting project that has been legally restricted for those
citizens.
___ (9.) A grant is received to landscape tree-lined areas beside city-owned streets.
___ (10.) The city spends grant money received in (9.) above and landscapes the tree-lined areas
beside the streets for which the grant money was received.

Accepted Answer

The answer of For each of the following transactions, select...

Question 11

In governmental accounting, what term is used for a decrease in financial resources?

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The answer of In governmental accounting, what term is used...

Question 12

For what is a special revenue fund used to account?

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Question 13

Which of the following would be considered a derived tax revenue? 
A)Collection of property taxes.
B)FICA is withheld from the employee pay.
C)A grant is received from the federal government.
D)A private citizen willing sends money to buy books for the local library.
E)Fees are collected on overdue library books.

Accepted Answer

Derived tax revenues are taxes that are collected based on an underlying transaction or event, such as income or sales. FICA (Federal Insurance Contributions Act) taxes are derived from employee wages.

Question 14

What are the two sets of financial statements mandated by GASB for state and local governments? For each set, what are the names of the individual statements that must be produced?

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Question 15

Which of the following is not a true statement regarding revenues from various types of nonexchange transactions?
A) Derived tax revenues occur as a result of sales and or income tax.
B) Imposed nonexchange revenues consist of only fines and penalties assess by the governing agency.
C) Government mandated nonexchange transactions includes grants from the federal government to the local public school system for a free lunch program.
D) Voluntary nonexchange transactions can originate from a governmental agency or private citizen organization.
E) Imposed nonexchange transactions revenue recognition is made in the time period when the resulting resources are required to be used or in the first period in which use is permitted.

Accepted Answer

Imposed nonexchange revenues may also include licensing fees, permits, or other charges that are required by law.

Question 16

Under modified accrual accounting, when should revenues be recognized by a governmental-type fund?

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Question 17

What assets would be included in the accounting records of a city's general fund?

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Question 18

What are the five types of governmental funds?

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Question 19

Which type of account would you assign a gift of $1.5 million dollars with restriction indicating that only the future income generated from this balance can be used by the government?
A) Committed
B) Nonspendable
C) Assigned
D) Unassigned
E) Restricted

Accepted Answer

The answer of Which type of account would you assign...

Question 20

Which statement most accurately reflects property taxes?
A) Property taxes are derived tax revenues because property owners have the benefit of ownership.
B) Property taxes are considered a special assessment by the governing agency.
C) When recording, property taxes the receivable is record and the revenue is recognized when the government has enforceable legal claim.
D) When recording, property taxes the revenue is recognized in the period in which it can be used.
E) Property taxes are the result of the government making an assessment, only when an underlying exchange has occurred.

Accepted Answer

The answer of Which statement most accurately reflects property taxes?
A)...

Quiz 16: Accounting for State and Local Governments, Part I