A local government was awarded a federal grant in the amount of $800,000 to provide for a summer youth employment program for young people.The grant was a reimbursement grant,and a notification of the grant award was received on Apri1 30,2012.The local government expended the resources as follows:
The federal government sent the funds in the month following the expenditure.The local government would recognize revenues for the fiscal year ended June 30,2012 in which amount?

Question

Quizplus · Accepted Answer

The local government received notification of the federal grant on April 30, 2012, and the funds were sent by the federal government in the month following the expenditure. Therefore, all the expenditures for the summer youth employment program would have been made after April 30, 2012. As the grant was a reimbursement grant, the local government would need to spend the funds first and then be reimbursed by the federal government. As a result, the local government would not have received any revenues for the fiscal year ended June 30, 2012, as the funds were not yet received by that date. Therefore, the correct choice is D.

A Local Government Was Awarded a Federal Grant in the Amount