Question 1

A city government collects local option sales taxes legally restricted to pay for the construction of a new courthouse. Which fund should account for the receipt of the sales taxes?

Accepted Answer

A)   Special revenue fund
B)   Capital projects fund
C)   Private-purpose trust fund
D)   General fund

Question 2

State and local governmental funds are organized into three categories including:

Accepted Answer

A)   Governmental, proprietary and restricted
B)   Proprietary, fiduciary and restricted
C)   Governmental, fiduciary and restricted
D)   Governmental, proprietary and fiduciary

Question 3

Financial reports for state and local governments are used for all the following EXCEPT?

Accepted Answer

A)   Assess financial condition and results of operations
B)   Measuring the effectiveness of government services such as police and fire protection
C)   Compare actual results with the legally adopted budget
D)   Assist in determining compliance with finance-related laws and regulations

Question 4

What is the significance of a budget to a government?

Accepted Answer

A)   Used primarily as a planning resource
B)   Budgets are not used by governments
C)   Budgets carry the full authority of the law
D)   None of the above

Question 5

According to GASB standards relating to Budgetary Accounting, an annual budget should be adopted by every governmental unit.

Accepted Answer

A) True 
 B)False

Question 6

Depreciation on capital assets is included as an expense in the Statement of Revenues, Expenses and Changes in Fund Net Assets in the proprietary fund financial statements

Accepted Answer

A) True 
 B)False

Question 7

Level "A" GAAP for The University of Virginia, a public institution, would be established by the:

Accepted Answer

A)   Financial Accounting Standards Board
B)   Governmental Accounting Standards Board
C)   American Institute of Certified Public Accountants
D)   National Association of College and University Business Officers

Question 8

The Financial Accounting Standards Board has authority to establish accounting and financial reporting standards for both private and state universities.

Accepted Answer

A) True 
 B)False

Question 9

The ______ Fund accounts for all resources other than those required to be accounted for in other funds.

Accepted Answer

A)   Special revenue
B)   General
C)   Enterprise
D)   Agency

Question 10

Long-term debt of a governmental unit would be reported in the:

Accepted Answer

A)   Government-wide financial statements and proprietary fund financial statements
B)   Government-wide financial statements only
C)   Debt service funds of governmental fund financial statements and government-wide financial statements
D)   Notes to the financial statements only

Question 11

Which of the following statement(s)  are NOT included in the proprietary funds:

Accepted Answer

A)   Statement of Revenues, Expenses and Changes in Net Assets
B)   Statement of Cash Flows
C)   Balance Sheet
D)   All of the above are included

Question 12

Capitalized fixed assets are reported in which financial statement?

Accepted Answer

A)   Fiduciary fund
B)   Proprietary fund
C)   Governmental fund
D)   All of the above

Question 13

A government may have __________________ general fund(s)  in a given year?

Accepted Answer

A)   As many as needed
B)   Only one
C)   The number will vary depending on the needs of the government
D)   None of the above

Question 14

A city government makes its semiannual payment of interest on revenue bonds issued to pay for the construction of additional subway stations. Which fund would account for the payment?

Accepted Answer

A)   Debt service fund
B)   Capital projects fund
C)   Enterprise fund
D)   Internal service fund

Question 15

In order for a fund to exist, there must be

Accepted Answer

A)   Assets set aside for specific purposes
B)   A separate revenue stream
C)   A double-entry accounting entity
D)   A and C are correct

Question 16

Comparison of the legally approved budget with actual results of the General Fund is included as part of required supplementary information in the CAFR.

Accepted Answer

A) True 
 B)False

Question 17

FASB sets the reporting standards for private and public not-for-for profits
Answer False

Accepted Answer

A) True 
 B)False

Question 18

Long-term debt paid from proprietary funds is reported as a liability in

Accepted Answer

A)   The proprietary fund Statement of Net Assets
B)   The government-wide Statement of Net Assets
C)   Both A and B
D)   Neither A nor B

Question 19

Contrast revenue recognition under the accrual and modified accrual bases of accounting.

Accepted Answer

Under modified accrual accounting, reven...

Question 20

Which of the following fund types uses modified accrual accounting?

Accepted Answer

A)   Debt Service
B)   Internal Service
C)   Investment Trust
D)   Enterprise

Exam 2: Overview of Financial Reporting for State and Local Governments

A city government makes its semiannual payment of interest on revenue bonds issued to pay for the construction of additional subway stations. Which fund would account for the payment?

Correct AnswerverifiedShow Answer

Comparison of the legally approved budget with actual results of the General Fund is included as part of required supplementary information in the CAFR.

Correct AnswerverifiedShow Answer

Capitalized fixed assets are reported in which financial statement?

Correct AnswerverifiedShow Answer

In order for a fund to exist, there must be

Correct AnswerverifiedShow Answer

State and local governmental funds are organized into three categories including:

Correct AnswerverifiedShow Answer

Long-term debt of a governmental unit would be reported in the:

Correct AnswerverifiedShow Answer

Which of the following statement(s) are NOT included in the proprietary funds:

Correct AnswerverifiedShow Answer

What is the significance of a budget to a government?

Correct AnswerverifiedShow Answer

FASB sets the reporting standards for private and public not-for-for profits Answer False

Correct AnswerverifiedShow Answer

The Financial Accounting Standards Board has authority to establish accounting and financial reporting standards for both private and state universities.

Correct AnswerverifiedShow Answer

A government may have __________________ general fund(s) in a given year?

Correct AnswerverifiedShow Answer

Which of the following fund types uses modified accrual accounting?

Correct AnswerverifiedShow Answer

According to GASB standards relating to Budgetary Accounting, an annual budget should be adopted by every governmental unit.

Correct AnswerverifiedShow Answer

Long-term debt paid from proprietary funds is reported as a liability in

Correct AnswerverifiedShow Answer

Level "A" GAAP for The University of Virginia, a public institution, would be established by the:

Correct AnswerverifiedShow Answer

A city government collects local option sales taxes legally restricted to pay for the construction of a new courthouse. Which fund should account for the receipt of the sales taxes?

Correct AnswerverifiedShow Answer

Depreciation on capital assets is included as an expense in the Statement of Revenues, Expenses and Changes in Fund Net Assets in the proprietary fund financial statements

Correct AnswerverifiedShow Answer

The ______ Fund accounts for all resources other than those required to be accounted for in other funds.

Correct AnswerverifiedShow Answer

Contrast revenue recognition under the accrual and modified accrual bases of accounting.

Correct AnswerverifiedUnder modified accrual accounting, reven...View AnswerShow Answer

Financial reports for state and local governments are used for all the following EXCEPT?

Correct AnswerverifiedShow Answer

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Under modified accrual accounting, reven...
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Correct Answer
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