test 1 - MC

Question 1

Which of the following would NOT be considered a nonprofit organization?

a.BFLA
b.YWCA
c.PACT
d.PKF

Answer 1

PKF

Question 2

Which of the following would be considered an NGO?

a.BELIZE WATER SERVICES LTD
b.BFLA
c.PKF
d.NATIONAL SPORTS COUNCIL

Answer 2

BFLA

Question 3

Which of the following characteristics best distinguishes a government entity from a business entity?

a.Those contributing resources to the entity do not necessarily receive a direct or proportionate share the services.

b.Governments operate in a very small section of the economy while businesses operate globally.

c.Cost analysis and other control and evaluation techniques are essential to ensure that resources are used economically and efficiently.

d.Businesses must acquire and convert scarce resources while governments can demand whatever they need.

Answer 3

Those contributing resources to the entity do not necessarily receive a direct or proportionate share the services.

Question 4

Governmental funds recognize

a.Expenditures when the fund incurs a liability

b.Expenses when the fund assets are consumed.

c.Expenditures when the governmental unit incurs a liability for goods or services.

d.Expenses when the governmental unit uses goods or services.

Answer 4

Expenditures when the fund incurs a liability

Question 5

A local government issued $4,000,000 in general obligation bonds to finance the widening of a local thoroughfare. This transaction will most likely

a.Decrease fund balance in the Capital Projects Fund by $4,000,000.

b.Increase fund balance in the General Fund by $4,000,000.

c.Increase fund balance in the Capital Projects Fund by $4,000,000.

d.Decrease fund balance in the General Fund by $4,000,000.

Answer 5

Increase fund balance in the Capital Projects Fund by $4,000,000.

Question 6

An activity that is unique to governments is:

a.CASH MANAGEMENT
b.BUDGETING
c.MANAGING
d.LEVYING TAXES

Answer 6

LEVYING TAXES

Question 7

Who audits the various government departments of GOB

a.AUDITORS FROM ICAB
b.Audits of GOB departments are performed by anyone who wins the bid
c.AUDITORS FROM SAIB
d.AUDITORS FROM AICPA

Answer 7

AUDITORS FROM SAIB

Question 8

Financial accounting standards from which accounting body is followed by Belize City Council?

a.FASAB
b.IFRS
c.GASB
d.FASB

Answer 8

IFRS

Question 9

Because Belize City Council is a governmental entity which of the following is true?

a.Its annual report does not contain any long-term liabilities on its Balance Sheet

b.Its Balance Sheet does not have any equity section

c.Its annual report does not contain a Statement of Cash Flows

d.There are no revenues on its income statement

Answer 9

Its Balance Sheet does not have any equity section

Question 10

A local government paid $1,000,000 principal and $200,000 interest on its general obligation bonds that it issued to finance widening of a local thoroughfare. This transaction will most likely

a.Decrease fund balance in the Capital Projects Fund by $1,200,000.

b.Decrease fund balance in the Capital Projects Fund by $1,000,000.

c.Decrease fund balance in the Debt Service Fund by $1,200,000.

d.Decrease fund balance in the Debt Service Fund by $1,000,000.

Answer 10

Decrease fund balance in the Debt Service Fund by $1,200,000.

Question 11

A city’s General Fund general ledger includes accounts called Estimated Revenues, Appropriations, and Encumbrances. This indicates that the city

a.Erroneously reports encumbrances as expenditures.

b.Maintains its accounts on an accrual basis.

c.Uses a cash plus encumbrances basis of accounting.

d.Formally integrates its budget into its accounts.

Answer 11

Formally integrates its budget into its accounts.

Question 12

Which of the following is NOT a characteristic of a fund?

a.ACCOUNTING ENTITY

b.SEPARATE LEGAL ENTITY

c.CONTAINS SELF BALANCING SET OF ACCOUNTS

d.FISCAL ENTITY

Answer 12

SEPARATE LEGAL ENTITY

Question 13

The primary purpose of a fund is:

a.To provide expenditure authority for a government or not-for-profit organization.

b.To confuse and confound the legislative body as to the use and purpose of government resources.

c.To keep an organization’s constituency from trying to insist that the organization utilize resources that it wants to save for a specific future objective.

d.To segregate an organization’s resources according to the purpose(s) for which they are to be used.

Answer 13

To segregate an organization’s resources according to the purpose(s) for which they are to be used.

Question 14

Belize City Council can only have one:

a.CAPITAL PROJECT FUND
b.SPECIAL REVENUE FUND
c.GENERAL FUND
d.DEBT SERVICE FUND

Answer 14

GENERAL FUND

Question 15

Which of the following is the basic proprietary fund accounting equation?

a. Assets – Liabilities = Net Assets.

b. Assets + Deferred Outflows – Liabilities – Deferred Inflows = Net Position.

c. Assets = Liabilities and Equity

d. Financial Assets + Deferred Outflows – Related Liabilities – Deferred Inflows = Fund Balance

Answer 15

Assets + Deferred Outflows – Liabilities – Deferred Inflows = Net Position.

Question 16

Which of the following is the basic governmental fund accounting equation?

a.Assets – Liabilities = Net Assets.

b.Financial Assets + Deferred Outflows – Related Liabilities – Deferred Inflows = Fund Balance.

c.Assets = Liabilities and Equity

d.Assets + Deferred Outflows – Liabilities – Deferred Inflows = Net Position.

Answer 16

Financial Assets + Deferred Outflows – Related Liabilities – Deferred Inflows = Fund Balance.

Question 17

The purpose of encumbrance accounting is to

a.Manage a government’s cash flows.

b.Replace expense accounting in governments.

c.Prevent government waste.

d.Avoid expenditures exceeding appropriations.

Answer 17

Avoid expenditures exceeding appropriations.

Question 18

Legal authority to expend resources is adopted by a city council in the budgeting process. These legal authorizations are called

a.APPROPRIATIONS
b.EXPENDITURES
c.ENCUMBRANCES
d.AUTHORIZATIONS

Answer 18

APPROPRIATIONS

Question 19

The city of Belmopan’s Special Revenue Fund levied $350,000 in taxes, of which 1% was expected to be uncollectible during the current year. Also, during the year, the fund collected $7,500 of interest revenue and $50,000 was transferred from the General Fund. As a result of these transactions fund balance will increase by

a.$ 354,000

b.$ 357,500

c.$ 404,000

d.$ 407,500

Answer 19

$ 404,000

Question 20

Taxes receivable of $80,000, which have a related allowance for uncollectible taxes of $8,000, become delinquent. The entry to record this includes a debit to

a.Revenues – Property Taxes.

b.Allowance for Uncollectible Delinquent Taxes.

c.Allowance for Uncollectible Current Taxes.

d.Taxes Receivable – Current.

Answer 20

Allowance for Uncollectible Current Taxes.