In budgeting for a governmental fund, the government should appropriate the resources for general capital assets in the periods when they are to be purchased, not those in which they will be used.

Question

Quizplus · Accepted Answer

This is known as the capital projects fund and follows the modified accrual basis of accounting. The resources should be appropriated in the period when they will be used to acquire the capital assets, not when they will be used. This ensures that the accounting reflects the true cost of the project and helps in planning for future capital expenditures.

In Budgeting for a Governmental Fund, the Government Should Appropriate