F9 - M3 - Transactions and Events: Part 1

Question 1

The governmental (GRaSPP) funds use modified accrual accounting, which includes the following: BAE

Answer 1

Budget, Actual and Encumbrances

Question 2

_________ accounting is used to control spending.

Answer 2

Budgetary

Question 3

______ accounting emphasizes the flow of current financial resources.

Answer 3

Activity

Question 4

_______ accounting is used to record purchase orders and aid in the control of spending.

Answer 4

Encumbrance

Question 5

Most governmental (GRaSPP) funds record _____, ______ and during the year and close them out at the end of each year (BAE-BAE).

Answer 5

budgets, activity, and encumbrances

Question 6

Recording a ______ that is formally integrated with a government’s accounting system involves journalizing budgeted transactions using the following accounts at the start of the year:

Answer 6

budget

Question 7

What is the JE to record a budget

Answer 7

DR Estimated Revenues. CR Appropriations CR/DR Budgetary Control Account (for difference)

Question 8

What is the entry to close out the budget at the end of the year?

Answer 8

Dr Appropriations CR Estimated Revenue CR/DR Budgetary Control (for difference)

Question 9

Governmental fund revenues are recorded in the real accounts when they are both ____ and ______ and have met time requirements.

Answer 9

measurable and available

Question 10

“Available” is generally defined as collected within _____ days of year-end.

Answer 10

60

Question 11

Real property taxes (imposed non-exchange revenues) are accrued when _______with related revenue recognition subject to the measurable and available criteria.

Answer 11

billed to property owners

Question 12

Measurable but unavailable receivables are recognized but accrued as a _____________.

Answer 12

deferred inflow.

Question 13

Derived tax revenues (sales taxes) are accrued if measurable and collected within ___________.

Answer 13

60 days after fiscal year-end (available).

Question 14

Derived tax revenues may not be fully measurable and thus not recognized until __________

Answer 14

tax returns are filed.

Question 15

To meet time requirements, revenues are recognized in the period in which resources must be ________ or ___________

Answer 15

used or when use may begin.

Question 16

Billings not meeting time requirements are accrued as ________________.

Answer 16

deferred inflows.

Question 17

_________ are recognized when the vouchers payable (or cash outlay) is recorded

Answer 17

Expenditures

Question 18

Capital purchases, debt service payments, and operating expenditures are treated as a current year’s _________.

Answer 18

expenditures.

Question 19

Expenditures for supplies, (prepaid) insurance, and inventory can be accounted for by the ______ method or ___________ method.

Answer 19

purchase method or consumption method.

Question 20

Transfers out to other funds, or interfund transfers, represent a use of financial resources, not an ___________.

Answer 20

expenditure item.

Question 21

For external reporting, governmental fund expenditures are first classified according to the appropriate fund. Within the fund, there may be further classification by ________ or ___________.

Answer 21

function or program.

Question 22

For internal or analytical purposes, expenditures also may be classified by (3)

Answer 22

organizational unit, activity, or object class.

Question 23

Fixed assets purchased, constructed, or leased are not capitalized; however, they are reported on the _______________ financial statements

Answer 23

government-wide

Question 24

Long-term asset acquisition or construction is recorded as a ______________ in governmental fund financial statements.

Answer 24

capital outlay expenditure

Question 25

____________ is not recorded as debt in a governmental fund

Answer 25

long-term debt

Question 26

new long-term debt is classified as _______________on the governmental fund financial statements.

Answer 26

other financing source

Question 27

Debt payments are recorded as __________ for both principal and interest, not reduction to liability (does not exist in Governmental funds)

Answer 27

expenditures

Question 28

Long-term debt is reported on the ____________ financial statements

Answer 28

government-wide

Question 29

Leases are classified as (3)

Answer 29

1) operating leases, 2) contracts that transfer ownership and 3) leases other than operating leases and contracts that transfer ownership.

Question 30

Government - Operating leases have terms and conditions nearly identical to operating leases in commercial settings and are fully recognized as ______ or __________

Answer 30

operating expenses (accrual) or expenditures (modified accrual).

Question 31

Governmental funds simultaneously recognize a ____________ and _________ with payments recorded as an expenditure similar to their treatment of fixed asset purchases and long- term financing.

Answer 31

capital outlay expenditure; other financing source

Question 32

Asset and liability recognition for contracts that transfer ownership are identical to commercial accounting for finance leases consistent with the accrual basis of accounting used in ________________

Answer 32

proprietary funds and government-wide presentations.

Question 33

Leases other than operating leases and contracts that transfer ownership are recorded as a ________ and _______ in governmental funds. Funds that use accrual accounting and the government-wide financial statements recognize a ______ asset and _________.

Answer 33

capital outlay ; other financing source ; right-of-use asset : liability.