85 terms

CPA Questions #1

Which of the following fund types of a governmental unit has income determination as a measurement focus?
c. General Funds: No, Capital project funds: No
In governmental accounting, a fund is
I. The basic accounting unit
II. Used to assist in ensuring fiscal compliance
c. Both I and II
Fund accounting is used by governmental units with resources that must be
c. Segregated for the purpose of carrying on specific activities or attending certain objectives
Which of the following fund types used by a government most likely would have a nonspendable Fund Balance (for inventory of supplies)?
a. General
Sig City
b. Three
The modified accrual basis of accounting should be used for which of the following funds?
a. Capital projects fund
The encumbrance account of a governmental unit is debited when
b. A purchase order is approved
Which account should Spring Township credit when it issues a purchase order for supplies?
c. Reserve for encumbrances
New City
b. Credit to reserve for encumbrances of $850,000
The measurement focus of governmental-type funds is on the determination of
d. Flow of financial resources: Yes, Financial position: Yes
The estimated revenues control account of a governmental unit is debited when
d. The budget is recorded
The budget of a governmental unit, for which the appropriations exceed the estimated revenues, was adopted and recorded in the general ledger at the beginning of the year. During the year, expenditures and encumbrances were less than appropriations; whereas revenues equaled estimated revenues. The budgetary fund balance account is
c. Debited at the beginning of the year and credited at the end of the year
Rolan County
d. Estimated Revenues control should be credited for $20,000,000
Carlson City
b. DR: Unassigned Fund balance $132,000
CR: Reserve for encumbrances 132,000
Elm City
d. $5,000
Cliff City
c. $500,000
A budgetary fund balance reserved for encumbrances in excess of a balance of encumbrances indicates
d. A recording error
Which of the following journal entries should a city use to record $250,000 for fire department salaries incurred during May?
d. Debit: Expenditures-salaries $250,000, Credit: Salaries payable $250,000
Soan County
a. Purchase of fixed assets
Under the modified accrual basis of accounting for a governmental unit, revenues should be recognized in the accounting period in which they
c. Become available and measureable
Expenditures of a governmental unit for insurance extending over more than one accounting period
d. May be allocated between or among accounting periods or may be accounted for as expenditures of the period of acquisition.
City of Walton
a. $0
Park City uses encumbrance accounting and formally integrates its budget into the general fund's accounting records. For the current year ending July 31, the following budget was adopted: Estimated revenues $30,000,000, Appropriations 27,000,000, Estimated transfer to debt service fund 900,000. When Park's budget is adopted and recorded, Park's budgetary fund balance would be a
c. $2,100,000 credit balance
Park City uses encumbrance accounting and formally integrates its budget into the general fund's accounting records. For the current year ending July 31, the following budget was adopted: Estimated revenues $30,000,000, Appropriations 27,000,000, Estimated transfer to debt service fund 900,000. Park should record budgeted appropriations by a
a. Credit to appropriations control, $27,000,000
For the budgetary year, Maple City's general fund expects the following inflows of resources: Property taxes, licenses, and fines $9,000,000, Proceeds of debt issue 5,000,000, Interfund transfers for debt service 1,000,000. In the budgetary entry, what amount should maple record for estimated revenues?
a. $9,000,000
When a purchase order is released, a commitment is made by a governmental unit to buy a computer to be manufactured to specifications for use in property tax administration. This commitment should be recorded in the general fund as an
b. Encumbrance
Which of the following amounts are included in a general fund's encumbrance account? I. Outstanding vouchers payable amounts II. Outstanding purchase order amounts III. Excess of the amount of a purchase order over the actual expenditure for that order
c. II only
Powell City
a. As an expenditure
When a snowplow purchased by a governmental unit is received, it should be recorded in the general fund as an
b. Expenditure
Dayne County
d. $900,000
A state had general obligation bonds outstanding that required payment of interest on July 1 and January 1 of each year. State law allowed for the general fund to make debt payments without the use of a fiscal agent. The fiscal year ended June 30. Which of the following accounts would have decreased when the state paid the interest on July 1?
d. Fund balance
Cal City
b. $1,000,000
The following information pertains to Park Township's general fund at December 31: Total assets, including $200,000 of cash $1,000,000, Total liabilities 600,000, Reserved for encumbrances 100,000. Appropriations do not lapse at year-end. At December 31, what amount should Park report as unassigned fund balance in its general fund balance sheet?
b. $300,000
Assuming no outstanding encumbrances at year end, closing entries for which of the following situations would increase the unassigned fund balance at year end?
d. Appropriations exceed actual expenditures
A county's balance in the general fund included the following: Appropriations $435,000, Encumbrances 18,000, Expenditures 164,000, Vouchers payable 23,000. What is the remaining amount available for use by the county?
c. $253,000
Pine City
b. $2,500,000
Blair County
a. $0
Lake County
b. $900,000
Arbor City
c. $300,000
Grove Township
d. Bond Anticipation Notes Payable
A capital projects fund for a new city courthouse recorded a receivable of $300,000 for a state grant and a $450,000 transfer from the general fund. What amount should be reported as revenue by the capital projects fund?
b. $300,000
Japes City
a. $1,010,000
Mentor Town
a. $4,000,000 in the current year
Fir City
c. $400,000 $600,000
The debt service fund of a governmental unit is used to account for the accumulation of resources for, and the payment of, principal and interest in connection with a Private-purpose trust fund and Proprietary funds
a. No No
A major exception to the general rule of expenditure accrual for governmental units relates to unmatured Principal of general long-term debt and interest on general long term debt
a. Yes Yes
U City
c. Operating transfers Expenditures
Dale City
d. $5,300,000 $0
Alma Township
b. $700,000
Oak County
a. $0
Fern Village
c. $3,400,000
Tang City
b. Permanent
Arlen City
a. $0
Fixed assets donated to a governmental unit should be recorded
b. At estimated fair value when received
The orientation of accounting and reporting for all proprietary funds of governmental units is
a. Income determination
Cole City
a. $1,400,000
Which of the following bases of accounting should a government use for its proprietary funds in measuring financial position and operating results? Modified accrual basis, Accrual basis
a. No Yes
Glen Village
d. $410,000
The billings for transportation services provided to other governmental units are recorded by the internal service fund as
b. Operating revenues
Which of the following does not affect an internal service fund's net income?
d. Temporary transfers
Gem City
b. Transfers in
New County
d. Operating Revenues Control
An enterprise fund would be used when the governing body requires that I. Accounting for the financing of an agency's services to other governmental departments be on a cost-reimbursement basis II. User charges cover the costs of general public services III. Net income information be provided for an activity
d. II and III
King City Council
d. Enterprise fund
Basketville City
c. Capitalize; depreciation is required
Cedar City
c. $45,000
Ridge City
c. $600,000
Elm City
a. Revenues control
Maple City's public employee retirement system (PERS) reported the following account balances at June 30: Reserve for employer's contributions $5,000,000, Actuarial deficiency in reserve for employer's contributions 300,000, Reserve for employee' contributions 9,000,000. Maple's PERS fund balance at June 30 should be
d. $14,300,000
Curry City
c. $700,000 $350,000
Grove City
d. As an asset of $10,000 and a liability of $4,000
A city's electric utility, which is operated as an enterprise fund, rendered billings for electricity supplied to the general fund. Which of the following accounts should be debited by the general fund?
b. Expenditures
In preparing combined financial statements for a governmental entity, interfund receivables and payables should be
c. Reported as amounts due to and due from other funds
Brandon County
a. $100,000
Which of the following transactions is an expenditure of a governmental unit's general fund?
c. Routine employer contributions from the general fund to a pension trust fund
Operating transfers received by a governmental-type fund should be reported in the Statement of Revenues, Expenditures, and Changes in Fund Balance as an
c. an other financing source
For which of the following funds do operating transfers affect the results of operations? Governmental funds, Proprietary funds
c. Yes Yes
Finch City
b. Capital projects fund
Kew City
c. Capital projects funds
Proceeds of General Obligation Bonds is an account of a governmental unit that would be included in the
c. Capital projects fund
Receipts from a special tax levy to retire and pay interest on general obligation bonds should be recorded in which fund?
c. Debt service
Central County
d. Enterprise fund
Which of the following funds of a governmental unit records depreciation?
c. Internal service fund
Town of Hill
a. Enterprise fund
Harland County
a. Agency fund