Which of the following is true regarding the use of Special Revenue Funds?
C) Special Revenue Funds may only be used when a substantial portion of the resources are provided by restricted or committed revenue sources
Which of the following statements is not true regarding modified accrual accounting?
B) Debt service expenditures for principal and interest are accrued
Regarding interfund transactions, which of the following is not correct?
C) Interfund transaction must be repaid
Which of the following statements is not correct?
C) Interfund reimbursements are classified as other financing sources or uses
The journal entry to record the re-establishment of encumbrances that were outstanding at the close of the prior period would include:
D) A and B would both be included in the journal entry
The journal entry to record the prior year's deferred property taxes (those expected to be collected more than 30 days beyond year end) as revenue in the current year would include:
D) B and C would both be included in the journal entry
The journal entry to record an encumbrance would include:
D) A and C would both be included in the journal entry
The journal entry to record the property tax levy for a municipality would include:
B) A credit to Revenues Control
Which of the following is true with respect to Special revenue funds?
D) Special revenue funds are used when it is desirable to provide separate reporting of resources that are restricted or committed as to expenditure for purposes other than debt service or capital projects
Which of the following is not true with respect to Special revenue funds?
D) Special revenue funds may be used for any designated purpose to segregate revenues and ensure compliance with restrictions
Which of the following is not correct with respect to accounting for supplies inventories in a governmental fund?
A) Typically, supplies inventory is a significant portion of governmental fund balances
Under the modified accrual basis of accounting, GASB standards for property tax revenue recognition provide that revenue should not be recognized for property taxes collected
C) More than 60 days after fiscal year end
Which of the following is true regarding modified accrual accounting?
B) Revenues are recognized in the period in which they become available and measurable, and expenditures are recognized at the time a liability is incurred, except for principal and interest on long-term debt.
When payrolls and other liabilities are incurred and must be paid before substantial amounts of cash will be collected, what type of short-term note is desirable and secured by a government's power to tax?
C) Tax Anticipation Note Payable
What is a Special Revenue Fund?
D) Fund used to account for revenues from specific taxes or other revenue sources that are restricted or committed to particular activities of the government other than capital projects
Expenditures are generally recorded and fund liabilities are recognized
B) When goods and services are received, regardless of whether or not resources are available in the fund.
When would a special revenue fund be deemed to have satisfied the eligibility requirement of a reimbursement-type federal grant, under GASB Statement 33?
A) Only as work is completed for a project.
The entry to re-establish encumbrances related to purchase orders from the prior year would include
B) A debit to Encumbrances Control
The Town of Little River expects to collect $90,000 in sales tax from the state government within 30 days of the end of fiscal year 2012. What entry, if any, would Little River make at the end of 2012?
A) Taxes receivable - current 90,000
Revenues control 90,000
Which of the following is not likely to be recorded in a special revenue fund?
C) Sales taxes restricted to courthouse additions
Short-term loans which are backed by the taxing power of the governmental unit and used to meet working capital requirements are called:
A) Tax anticipation notes.
A local government was awarded a federal grant in the amount of $1,200,000 to provide for a summer employment program for young people. The grant was a reimbursement grant and was awarded on April 30, 2012. The local government expended the resources as follows: June, 2012, $440,000; July 2012, $400,000; August, 2012, $360,000. The federal government provided the funds the following months. The local government would recognize revenues for the fiscal year ended June 30, 2012 in which amount?
C) $ 440,000
A donor pledged $200,000 to the fund raising drive of a local government to assist its police officers in obtaining the latest technology. The pledge was made on July 16, 2011 but was conditioned on the government raising an additional $200,000 from other donors. By the fiscal year-end of June 30, 2012, the local government had raised only $5,000 from other donors. What entry would be made for the initial pledge by the local government during the year ended June 30, 2012?
A) No entry is required
Which of the following is true regarding modified accrual accounting?
B) Expenditures for services used by General Fund departments should be recognized when those services are received, regardless of whether or not resources are available in the fund
The General Fund of the City of Lexington approved a tax levy for the calendar year 2012 in the amount of $2,000,000. Of that amount, $30,000 is expected to be uncollectible. During 2012, $1,750,000 was collected. During 2013, $100,000 was collected during the first 30 days, $70,000 was collected during the next 30 days, and $50,000 was collected during the next 30 days. During the postaudit, you discovered that the City showed $2,000,000 in revenues. What adjusting entry would you need to make, assuming you decided to allow the maximum amount of revenues for 2012, using modified accrual accounting?
A) Debit Revenues and Credit Deferred Revenues in the amount of $50,000.
The City of Brownsville had a balance in the Budgetary Fund Balance -- Reserve for Encumbrances account at the end of 2011 in the amount of $30,000. During 2012, all purchase orders related to the $90,000 were filled, and the invoice amount was $91,200. Which of the following would be true regarding the Statement of Revenues, Expenditures, and Changes in Fund Balances for 2012? (assume encumbrances do not lapse)
C) The amount shown for Expenditures would include the $91,200
When accounting for the General Fund, the Encumbrances Control account is credited when:
B) A purchase order is filled or canceled.
The City of Pine Cove levied property taxes for the fiscal year ended June 30, 2012 in the amount of $9,000,000. It is estimated that 2% will not be collected. During the year ended June 30, 2012, $8,100,000 in property taxes was collected. It is estimated that $500,000 will be collected during the next 60 days, $265,000 will be collected after 60 days, and $160,000 will not be collected. What is the maximum amount Lonesome Pines can recognize as property tax revenue for the fiscal year ended June 30, 2012 in its Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances, assuming there were no unpaid property taxes at the end of the previous year?