Which of the following is true regarding the Statement of Revenues,Expenses and Changes in Net Assets for a public college reporting as a special purpose entity engaged in business type activities only?
A) The accrual basis of accounting is used to measure revenues and expenses.
B) Encumbrances are recorded at the time purchase orders are issued.
C) Both of the above are true.
D) Neither of the above is true.

Question

Quizplus · Accepted Answer

Public colleges reporting as special purpose entities engaged in business type activities only are required to use the accrual basis of accounting to measure revenues and expenses. Encumbrances are not recorded in the Statement of Revenues, Expenses, and Changes in Net Assets for these entities.

Which of the Following Is True Regarding the Statement of Revenues,Expenses