A General Fund has total liabilities in excess of its total assets at the end of the fiscal year. It has no deferred resource inflows or outflows. Which of the following statements is always true?

Question

Quizplus · Accepted Answer

The governmental fund accounting equation is: Financial Assets = Short-term and Matured Long-Term Liabilities + Fund Balance. If liabilities are greater than assets, then fund balance must be negative to make the equation balance.

A General Fund Has Total Liabilities in Excess of Its