When the proceeds of long term debt are reported in governmental fund financial statements
A) They are reported only as an increase in liabilities in the funds.
B) They are reported only as revenues in the funds.
C) They are reported only as an other financing source-debt proceeds.
D) They are reported only as an other financing use-debt proceeds.

Question

Quizplus · Accepted Answer

In governmental fund financial statements, the proceeds of long-term debt are reported as an "other financing source-debt proceeds." This classification reflects the inflow of resources from long-term debt issuances, distinguishing it from regular revenues or increases in liabilities within the fund accounting model.

When the Proceeds of Long Term Debt Are Reported in Governmental