Governmental Funds FS (F9:M5-6)

Question 1

generally, expenditures are recognized when incurred because that is when they become measurable. What is the exception to this rule? (gov’t fund accounting)

Answer 1

interest and principal payments for LT debt. they are recorded as expenditures when PAID!

expenditure- int (d
expenditure- principal (d
cash (c

Question 2

what does a debt service fund do?

Answer 2

it literally services the debt of all the other governmental funds (accounts for the accumulation of resources for, and the payment of, principal and interest)

Question 3

when the general fund transfers money to the debt service fund (or really any other fund), what is the JE?

Answer 3

other financing uses (d

cash (c

Question 4

how are grants reported in the capital projects fund?

Answer 4

as revenue, either immediately (if unrestricted) or when the grant is spent (if restricted)

Question 5

what would a bond premium be considered?

Answer 5

other financing source

Question 6

what would a bond discount be considered?

Answer 6

other financing use

Question 7

what would the bond proceeds be considered?

Answer 7

other financing source

Question 8

how are bond issue costs (bond costs, underwriting fees, etc.) accounted for?

Answer 8

as debt service expenditures

Question 9

if bond proceeds are to be used to finance construction of a project, what fund would they be recorded in?

Answer 9

capital projections fund

Question 10

in a permanent fund, how are investments recorded (valued)?

Answer 10

at FV

Question 11

bond anticipation notes are current liabilities if the entity does not have the ability to…

Answer 11

refinance as a non current obligation