Ch 6 for Exam 2

Question 1

capital projects are usually paid for with ____________

Answer 1

bond issue

Question 2

the capital projects funds are not used to account for _____________

Answer 2

capital assets that are purchased directly with current revenues of the general fund or a special revenue fund

Question 3

governments must maintain capital projects funds for resources that are _______________ and _____________ for acquisition of capital assets

Answer 3

legally restricted; contractually required

Question 4

capital projects funds are accounts for on _____________-

Answer 4

modified accrual basis

Question 5

in government-wide statements the funds are accounted for on a ______________

Answer 5

full accrual basis

Question 6

capital projects and debt service funds are ____________ related

Answer 6

inversely

Question 7

when governments issue bonds do they usually receive ion cash the amount equal to the bond’s face value

Answer 7

no

Question 8

two main reasons govs dont get face value for bonds

Answer 8

issue costs and premiums/ discounts

Question 9

government reports underwriting cost as an _____________

Answer 9

expenditure

Question 10

debt service funds do not account for the _____________

Answer 10

long-term debt itself

Question 11

debt service funds are accounted for on __________ basis

Answer 11

modifed accrual

Question 12

special assessments

Answer 12

tax assessed on specific group of tax payers for project that benefits only them

Question 13

arbitrage

Answer 13

ability of gov to borrow money at low interest rate