The city is using an internal service fund to self-insure its risk financing activities.Claims accrued or paid by this fund are recorded as:

Question

Quizplus · Accepted Answer

Claims paid or accrued by an internal service fund for self-insurance are recorded as operating expenses under the applicable governmental function, function/activity, or program. Therefore, the best choice is option B, which records such claims as Operating Expense - Claims.

The City Is Using an Internal Service Fund to Self-Insure