Question 1

The General Fund of the City of Bangor purchased water from its Water Utility Fund in the amount of $20,000.The General Fund would debit:

Accepted Answer

The General Fund would debit Expenditures Control because it is recording an expenditure for the purchase of water from the Water Utility Fund.

Question 2

What would be the effect on the General Fund's Fund Balance at the end of the current fiscal year of recording the purchase of a $15,000 new computer with a five year estimated useful life and zero salvage?

Accepted Answer

Recording the purchase of a new computer as an expense would decrease the General Fund's Fund Balance by the full amount of the purchase, which is $15,000 in this case. Since there is no salvage value, the entire cost would be expensed over its five-year useful life, resulting in an annual depreciation expense of $3,000. However, only the initial purchase cost would affect the Fund Balance at the end of the current fiscal year.

Question 3

When closing out the General Fund and Special Revenue Funds of a state or local governmental unit,the balance of the operating statement accounts and the balances of the budgetary accounts are closed to:

Accepted Answer

The balance of the operating statement accounts and the balances of the budgetary accounts are closed to the Fund Balance. This represents the residual equity interest in the entire government's net assets. The Fund Balance is a residual category that reports the difference between assets and liabilities in governmental funds.

Question 4

General Fund resources were expended in the amount of $180,000 to purchase a new fire truck.The General Fund would debit:

Accepted Answer

In governmental accounting, the General Fund records expenditures for the purchase of capital assets like a fire truck as "Expenditures Control" rather than recording the asset itself.

Question 5

The Revenues Control account of the General Fund is debited when:

Accepted Answer

The Revenues Control account is debited when it is closed to Fund Balance.

Question 6

A local government was awarded a federal grant in the amount of $900,000 to provide for a summer youth employment program for young people.The grant was a reimbursement grant,and a notification of the grant award was received on Apri1 30,2014.The local government expended the resources as follows:
•June,2014,$350,000;
•July,2014,$300,000;
•August,2014,$250,000.
The federal government sent the funds in the month following the expenditure.The local government would recognize revenues for the fiscal year ended June 30,2014 in which amount?

Accepted Answer

The local government would recognize revenues for the fiscal year ended June 30, 2014, based on the expenditures made by that date. Since they spent $350,000 by June 30, 2014, they would recognize $350,000 in revenues for that fiscal year.

Question 7

Liabilities incurred,such as for accrued payroll,but still unpaid at year-end,should be recorded in the General Fund by a debit to which one of the following accounts?

Accepted Answer

The answer of Liabilities incurred,such as for accrued payroll,but still...

Question 8

Which of the following accounts in the General Fund is credited when a purchase order is approved?

Accepted Answer

The journal entry would be a debit to Encumbrances Control and a credit to Budgetary Fund Balance - Reserve for Encumbrances.

Question 9

The asset,equipment,used by a department accounted for by the General Fund of a governmental unit should be reported in the:

Accepted Answer

Assets used by a department accounted for by the General Fund are reported in the government-wide statements, which provide a broader view of the government's financial position, including all assets and liabilities.

Question 10

When the materials and supplies are received and the invoice is more than the related purchase order,this entry should be made:

Accepted Answer

When the invoice is higher than the purchase order, it means that there is an overage or variance in the expenses incurred. Therefore, we need to adjust the Expenditures Control account by debiting it for the amount of the invoice. This will increase the expenses and decrease the fund balance or cash available.

Question 11

A December 2014 year-end government should record which of the following as expenditures:

Accepted Answer

The answer of A December 2014 year-end government should record...

Question 12

When delinquent taxes are written off:

Accepted Answer

The answer of When delinquent taxes are written off:
...

Question 13

In February,X City ordered $500,000 of supplies.On March 17^th it received all of the ordered supplies and an invoice of $492,000.Which of the following would be recorded upon receipt of the supplies and invoice?

Accepted Answer

Upon receipt of the supplies and invoice, the city would debit the Budgetary Fund Balance -- Reserve for Encumbrances for the original encumbered amount of $500,000, reflecting the commitment made when the order was placed.

Question 14

Interfund services purchased by the General Fund are recognized as:

Accepted Answer

Intergovernmental purchases of services to the General Fund should be recognized as expenditures since the General Fund is the entity that benefits from the services. Transfers out and decreases in fund balance are not appropriate for this situation.

Question 15

The following items were included in the City of Wilson's General Fund expenditures for the year ended June 30,2014:
 How much should be classified as capital assets in Wilson's General Fund balance sheet at June 30,2014?

Accepted Answer

The answer of The following items were included in the...

Question 16

The Expenditures control account in the General Fund is debited when:

Accepted Answer

The Expenditures control account is debited when equipment previously ordered is received because this represents an actual expenditure of resources.

Question 17

When recording property taxes,the estimated uncollectible amount of property taxes is:

Accepted Answer

The estimated uncollectible amount of property taxes is recognized as a reduction of revenue because it represents taxes that are unlikely to be collected and therefore should not be included as part of the total revenue earned. This is done in accordance with the principle of conservatism in accounting, which requires that uncertainties and risks be accounted for in a conservative manner.

Question 18

Debt service expenditures for interest are:

Accepted Answer

Debt service expenditures for interest are generally recorded when due, but if the due date is less than 30 days after year-end, they may be accrued at year-end. This is in accordance with Generally Accepted Accounting Principles (GAAP) for governmental accounting. Therefore, option B is the most appropriate answer as it correctly reflects the treatment of debt service expenditures for interest. Options A, C and D are incorrect.

Question 19

Which of the following is true regarding modified accrual accounting?

Accepted Answer

Modified accrual accounting recognizes revenues when they are measurable and available to finance expenditures of the current period. On the other hand, expenditures are generally recognized as the related goods or services are received. Therefore, both option (a) and (b) are true regarding modified accrual accounting.

Question 20

A transfer should be reported in the operating statement of the General Fund as a(an):

Accepted Answer

A transfer is a movement of resources between funds, and should be reported as an Other Financing Source or Use in the operating statement of the General Fund. This indicates that the transfer is not related to the operating activities of the fund, but rather to financing or investing activities.

Quiz 4: Accounting for the General and Special Revenue Funds

The General Fund of the City of Bangor purchased water from its Water Utility Fund in the amount of $20,000.The General Fund would debit:

What would be the effect on the General Fund's Fund Balance at the end of the current fiscal year of recording the purchase of a $15,000 new computer with a five year estimated useful life and zero salvage?

When closing out the General Fund and Special Revenue Funds of a state or local governmental unit,the balance of the operating statement accounts and the balances of the budgetary accounts are closed to:

General Fund resources were expended in the amount of $180,000 to purchase a new fire truck.The General Fund would debit:

The Revenues Control account of the General Fund is debited when:

Liabilities incurred,such as for accrued payroll,but still unpaid at year-end,should be recorded in the General Fund by a debit to which one of the following accounts?

Which of the following accounts in the General Fund is credited when a purchase order is approved?

The asset,equipment,used by a department accounted for by the General Fund of a governmental unit should be reported in the:

When the materials and supplies are received and the invoice is more than the related purchase order,this entry should be made:

A December 2014 year-end government should record which of the following as expenditures:

When delinquent taxes are written off:

In February,X City ordered $500,000 of supplies.On March 17^th it received all of the ordered supplies and an invoice of $492,000.Which of the following would be recorded upon receipt of the supplies and invoice?

Interfund services purchased by the General Fund are recognized as:

The following items were included in the City of Wilson's General Fund expenditures for the year ended June 30,2014: How much should be classified as capital assets in Wilson's General Fund balance sheet at June 30,2014?

The Expenditures control account in the General Fund is debited when:

When recording property taxes,the estimated uncollectible amount of property taxes is:

Debt service expenditures for interest are:

Which of the following is true regarding modified accrual accounting?

A transfer should be reported in the operating statement of the General Fund as a(an) :

Quiz 4: Accounting for the General and Special Revenue Funds

The General Fund of the City of Bangor purchased water from its Water Utility Fund in the amount of $20,000.The General Fund would debit:

What would be the effect on the General Fund's Fund Balance at the end of the current fiscal year of recording the purchase of a $15,000 new computer with a five year estimated useful life and zero salvage?

When closing out the General Fund and Special Revenue Funds of a state or local governmental unit,the balance of the operating statement accounts and the balances of the budgetary accounts are closed to:

General Fund resources were expended in the amount of $180,000 to purchase a new fire truck.The General Fund would debit:

The Revenues Control account of the General Fund is debited when:

Liabilities incurred,such as for accrued payroll,but still unpaid at year-end,should be recorded in the General Fund by a debit to which one of the following accounts?

Which of the following accounts in the General Fund is credited when a purchase order is approved?

The asset,equipment,used by a department accounted for by the General Fund of a governmental unit should be reported in the:

When the materials and supplies are received and the invoice is more than the related purchase order,this entry should be made:

A December 2014 year-end government should record which of the following as expenditures:

When delinquent taxes are written off:

In February,X City ordered $500,000 of supplies.On March 17th it received all of the ordered supplies and an invoice of $492,000.Which of the following would be recorded upon receipt of the supplies and invoice?

Interfund services purchased by the General Fund are recognized as:

The following items were included in the City of Wilson's General Fund expenditures for the year ended June 30,2014: How much should be classified as capital assets in Wilson's General Fund balance sheet at June 30,2014?

The Expenditures control account in the General Fund is debited when:

When recording property taxes,the estimated uncollectible amount of property taxes is:

Debt service expenditures for interest are:

Which of the following is true regarding modified accrual accounting?

A transfer should be reported in the operating statement of the General Fund as a(an) :

In February,X City ordered $500,000 of supplies.On March 17^th it received all of the ordered supplies and an invoice of $492,000.Which of the following would be recorded upon receipt of the supplies and invoice?