Accounting Techniques

Question 1

Cash Basis

Answer 1

Recognizes revenue when cash is received and expenses when a resource is paid in cash. Cash basis accounting is helpful if the goal is to know exactly how much money is available to cover expenses in the near future.

Question 2

Accrual Basis

Answer 2

recognizes revenue when the jurisdiction delivers a good or service, even if it does not receive cash, and expenses when a resource is used to deliver those goods or services, even if it does not pay cash. Accrual basis accounting is ideal when the goal is to understand the government’s long-term financial condition.

Question 3

Modified Accrual Basis

Answer 3

recognizes revenues when they become available and measurable, and expenses when they are incurred. This basis is unique to state and local governments. It is designed to reflect the cash flows related to government revenues.

Question 4

What are the two financial statements contained in the Comprehensive Annual Financial Report?

Answer 4

1. ) Statement of Net Position

2. ) Statement of Activities

Question 5

Liquid?

Answer 5

Current Assets > Current Liabilities , Cash?

Question 6

Solvent?

Answer 6

Assets > Liabilities, Unrestricted Assets?

Question 7

Profitable?

Answer 7

Revenues > Expenses, Unrestricted Revenue?

Question 8

Transactions are represented in?

Answer 8

1. ) Statement of Financial Position
2. ) Statement of Activities
3. ) Functional Expense Report
4. ) Cash Flow Statement

Question 9

Statement of Activities

Answer 9

Is essentially a statement about how your net worth has changed.