Which group of financial statements is prepared using the "modified accrual accounting" approach?
A) GAAP-Based Financial Statements.
B) Fund-Based Financial Statements.
C) Cost-Based Financial Statements.
D) Government-Wide Financial Statements.
E) General Purpose Financial Statements.

Question

Quizplus · Accepted Answer

Fund-Based Financial Statements are prepared using the modified accrual accounting approach, which records revenues when measurable and available and records expenditures when a liability is incurred. This approach is used by governmental funds such as the general fund, special revenue funds, debt service funds, and capital projects funds.

Which Group of Financial Statements Is Prepared Using the "Modified