ARE- Govt'l Fund Accounting

Question 1

What is the accounting equation in fund accounting?

Answer 1

Assets = Liabilities + Fund balance

Question 2

What is the recording of commitments related to unfilled contracts called

Answer 2

Encumbrances

Question 3

How are encumbrances recorded?

Answer 3

Dr. Encumbrances

Cr. Reserve for encumbrances

Question 4

How are previously encumbered expenditures recorded?

Answer 4

Dr. Reserve for encumbrances
Cr. Encumbrances

Dr. Expenditures
Cr. Vouchers payable

Question 5

How is a budget recorded?

Answer 5

Dr. Estimated revenue
Cr. Appropriations
Dr. or Cr. Fund balance

Question 6

Should estimated transfers in/out be recorded as part of a budget?

Answer 6

Yes

Question 7

How should property taxes be recorded?

Answer 7

Dr. Property tax receivable
Cr. Allowance for uncollectible accounts
Cr. Property tax revenues

Question 8

How may expenditures of a government be reported?

Answer 8

Fund
program
character
organizational unit
activity
object class

Question 9

True or False?

Estimated revenues should be closed against actual revenues.

Answer 9

True

Question 10

True or false the key to governmental accounting is profitability

Answer 10

False accountability over profitability

Question 11

Which fund pays the general long-term debt principal and interest

Answer 11

Debt service fund

Question 12

Where are fixed assets of proprietary funds recorded and depreciated

Answer 12

In the proprietary fund itself

Question 13

Where is the long-term debt of governmental funds accounted for

Answer 13

General long-term debt account group

Question 14

Name the two types of proprietary funds

Answer 14

1. enterprise fund

2. internal service fund

Question 15

What is the accounting method for governmental funds

Answer 15

Modified accrual

Question 16

What are the two types of interfund transfers

Answer 16

1. Residual equity transfers

2. Operating transfers

Question 17

Which fund is used to account for major construction projects

Answer 17

Capital projects fund

Question 18

Where should bond premiums received in the capital projects fund be transferred

Answer 18

Debt service fund

Question 19

If a government is not obligated for a special assessment where should the debt service be accounted for?

Answer 19

In an agency fund

Question 20

Would proprietary funds be found in a combined statement of reviews expenditures and changes in fund balance

Answer 20

No

Question 21

Where should the portion of a claim or judgment not available to be paid out of current funds be reported

Answer 21

Long-term debt account group

Question 22

For which funds should a statement of Cash flows be prepared

Answer 22

Proprietary funds and non-expendable trust funds

Question 23

In which funds should the proceeds of a governmental lottery to be used for the financing of a library be accounted

Answer 23

Special revenue fund

Question 24

what is the accounting method of a nonexpendable trust fund

Answer 24

Accrual accounting the same as proprietary funds

Question 25

What are the two methods of accounting for inventories of materials and supplies

Answer 25

1. Purchase method | 2. Consumption method

Question 26

When are interest and principal on long-term debt recognized as expenditures

Answer 26

when they are due

Question 27

Under governmental accounting when is collection considered to be soon enough so that revenue may be recognized

Answer 27

When it is collected within 60 days after year end

Question 28

How should property tax revenue be recorded

Answer 28

Net of any uncollectible amounts | Bad debt expense is not used

Question 29

Where is the debt of a proprietary fund recorded

Answer 29

In the proprietary fund itself | It services is on debt as well

Question 30

How should the purchase of electricity by a general fund from an enterprise fund be recorded

Answer 30

As an expenditure | this is a quasi-external transaction

Question 31

What type of internal fund transfer is made to establish or close a fund

Answer 31

Residual equity transfer

Question 32

which trust funds are accounted for in the same way as government funds

Answer 32

Expendable trust funds

Question 33

true or false budgets are recorded in proprietary funds

Answer 33

False

Question 34

What is the calculation for each years increase in expense and liability for solid waste landfills

Answer 34

Estimated total cost times landfill capacity used to date Over total landfill capacity Minus amount recognized in prior years

Question 35

True or false the interest paid by the government on refunds is lower than the interest charged by the government on late payments

Answer 35

True