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ACCTG471 accounting questions

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Question;1. Governmental;funds are identical to governmental activities, proprietary funds are identical;to business-type activities, and fiduciary funds are identical to fiduciary;activities of a government.;True False;2. An;objective of the accounting system for a state or a local government is to make;it possible both to present fairly the funds and activities of the government;in conformity with generally accepted accounting principles and to demonstrate;compliance with finance-related legal and contractual provisions.;True False;3. Individual;fund financial information is reported in separate columns of governmental and;proprietary fund financial statements for only those funds that meet the GASB;size-related criteria as major funds.;True False;4. Economic;resources are cash or items expected to be converted into cash during the;current period, or soon enough thereafter to pay current period;liabilities.;True False;5. A;fund is an accounting but not a fiscal entity.;True False;6. The;types of funds that may be used in governmental accounting are classified into;the three categories of governmental, proprietary, and fiduciary.;True False;7. The;governmental funds category includes the General Fund, special revenue funds;debt service funds, capital projects funds, and internal service funds.;True False;8. Governments;can, in part, demonstrate operational accountability by reporting proprietary;and fiduciary fund financial information, as well as all government-wide;financial information, using an economic resources measurement focus and the;accrual basis of accounting.;True False;9. All;capital assets acquired by or used by a fund should be reported in the fund;balance sheet or statement of net assets.;True False;10. Because;budgetary accounts are used by governments, their financial statements can;never be said to be in accord with generally accepted accounting;principles.;True False;Multiple Choice Questions;11. The;accounting system used by a state or local government must make it;possible;A. To present fairly the financial position and results of financial;operations of the government as a whole, as well as fund financial activity in;conformity with GAAP, and to demonstrate compliance with finance-related legal;and contractual provisions.;B. To prepare financial statements as required by the Financial Accounting;Standards Board.;C. To prepare consolidated accrual basis statements for the government as;a whole.;D. To provide Web-based bond offering statements to investment firms.;12. Which;of the following is not a characteristic of a fund as defined by GASB;standards?;A. An accounting entity.;B. A fiscal entity.;C. A segregated quantity of cash and other financial resources on deposit;with a designated trustee.;D. A self-balancing set of accounts.;13. In;accounting for state and local governments the modified accrual basis is;required for;A. Proprietary and fiduciary funds.;B. Governmental funds only.;C. Proprietary funds only.;D. All funds.;14. Under;the modified accrual basis of accounting, revenues should be recognized;when;A. Earned.;B. Collected in cash.;C. Authorized by the budget ordinance.;D. Measurable and available.;15. The;accrual basis of accounting applicable to proprietary fund types requires that;exchange revenues be recognized when;A. Earned.;B. Collected in cash.;C. Authorized by the budget ordinance.;D. Measurable and available.;16. Which;of the following funds is a governmental fund-type?;A. Private-purpose trust fund.;B. Internal service fund.;C. Permanent fund.;D. Enterprise fund.;17. Financial;resources set aside to pay principal and interest on general long-term debt may;be accounted for in which of the following fund types?;A. Private-purpose trust fund.;B. Debt service fund.;C. Principal and interest trust fund.;D. Internal service fund.;18. According;to GASB standards transfers should be recognized;A. When earned.;B. When collected in cash.;C. When authorized by the budget ordinance.;D. In the period the interfund receivable and payable arise.;19. Generally;accepted accounting principles applicable to state and local governments;require that;A. Only governmental funds and proprietary funds should be provided.;B. Only those funds required by law, GASB standards, and sound financial;administration should be provided.;C. Only those funds required by law should be provided.;D. All categories of funds must be provided.;20. Which;of the following is a proprietary fund?;A. Special revenue fund.;B. Investment trust fund.;C. Debt service fund.;D. Internal service fund.;21. Which;of the following is a fiduciary fund?;A. Investment trust fund.;B. Special revenue fund.;C. Debt service fund.;D. Enterprise fund.;22. Which;of the following funds would be most appropriate for accounting for an activity;that provides goods or services to the public for a fee that is intended to;make the activity self-supporting?;A. Investment trust fund.;B. Enterprise fund.;C. Internal service fund.;D. Special revenue fund.;23. Which;of the following funds should be used if resources provided by a federal grant;must be segregated and used for counseling of youthful offenders?;A. Private-purpose trust fund.;B. Enterprise fund.;C. Internal service fund.;D. Special revenue fund.;24. Which;of the following funds would be used to account for an activity that provides;centralized purchasing and sales of goods or services to other departments or;agencies of the governmental, or to other governments, on a cost-reimbursement;basis?;A. Enterprise fund.;B. Fiduciary fund.;C. Internal service fund.;D. Permanent fund.;25. Budgetary;comparison schedules presenting budgeted versus actual revenues and;expenditures are;A. Optional under GASB standards for all funds.;B. Required by GAAP for internal management reports only, not permitted;for external financial reporting.;C. Required by GAAP for the General Fund and major special revenue funds;for which an annual budget has been legally adopted.;D. Required by GAAP for all governmental fund types.;26. In;which of the following funds would it not be appropriate to record;depreciation of capital assets?;A. Special revenue fund.;B. Enterprise.;C. Internal service.;D. Pension trust.;27. Capital;assets used by departments accounted for by the General Fund of a governmental;unit should be accounted for in;A. The General Fund.;B. The governmental activities journal.;C. The business-type activities journal.;D. The general capital assets fund.;28. Reporting;fund financial information in separate columns for each major fund and;aggregate information for nonmajor funds;A. Means that only those funds that meet the GASB's 10 percent and 5;percent rules are reported in separate columns.;B. Is optional under GAAP, but is generally required by state laws for;governments.;C. Is the same manner of reporting used by business organizations.;D. Is required by generally accepted accounting principles for state and;local governments.;29. Capital;assets used by an enterprise fund should be accounted for in the;A. Enterprise fund and depreciation on the capital assets should be;recorded.;B. Business-type activities journal but no depreciation on the capital;assets should be recorded.;C. Governmental activities journal and depreciation on the capital assets;should be recorded.;D. Enterprise fund but no depreciation on the capital assets should be;recorded.;30. Which;of the following funds are proprietary funds?;A. Enterprise funds, investment trust funds, pension trust funds, and the;General Fund.;B. Enterprise funds and internal service funds.;C. Internal service funds, special revenue funds, and enterprise funds.;D. Proprietary funds are not used in governmental accounting.;31. Which;of the following funds are governmental funds?;A. General Fund, special revenue funds, capital projects funds, debt;service funds, and private-purpose trust funds.;B. General Fund, special revenue funds, private-purpose trust funds.;C. General Fund, special revenue funds, debt service funds, capital;projects funds, and permanent funds.;D. General Fund, special revenue funds, capital projects funds, debt;service funds, and internal service funds.;32. The;activities of a water utility department, which offers its services to the;general public on a user charge basis, should be accounted for in;A. An enterprise fund.;B. A special revenue fund.;C. The General Fund.;D. An internal service fund.;33. The;measurement focus and basis of accounting that are most unlike those;used by business entities are those used by;A. Governmental funds.;B. Fiduciary funds.;C. Proprietary funds.;D. Contribution funds.;34. Which;of the following organizations should not be included as part of the;governmental reporting entity?;A. A primary government.;B. Legally separate organizations for which the primary government is;financially accountable.;C. Organizations for which the nature and significance of their;relationship with the primary government are such that exclusion would cause;the reporting entity's financial statements to be misleading or incomplete.;D. Organizations which are legally and fiscally independent of a primary;government.;35. Under;GASB reporting entity standards, a component unit is;A. An organization for which the nature and significance of their;relationship with the primary government are such that exclusion would cause;the reporting entity's financial statements to be misleading or incomplete.;B. A legally separate organization that is financially independent of a;primary government and on which the primary government cannot impose its will.;C. A large department of a primary government.;D. A not-for-profit organization that is authorized to operate within the;boundaries of a city but is not accountable financially or in other way to the;city.;36. The;basis of accounting that should be used in preparing fund financial statements;is;A. Choice A;B. Choice B;C. Choice C;D. Choice D;37. A;major governmental fund is one that has one or more elements (e.g., assets;liabilities, revenues, or expenditures) that is at least;A. Five percent of the corresponding element(s) of total governmental;funds and 10 percent of the corresponding element(s) of total governmental and;enterprise funds combined.;B. Ten percent of the corresponding element(s) of total governmental funds;and 10 percent of the corresponding element(s) of total governmental and;enterprise funds combined.;C. Five percent of the corresponding element(s) of total governmental;funds and five percent of the corresponding element(s) of total governmental;and enterprise funds combined.;D. Ten percent of the corresponding element(s) of total governmental funds;and 5 percent of the corresponding element(s) of total governmental and;enterprise funds combined.;Short Answer;Questions;38. The;following are key terms in Chapter 2 that relate to principles of accounting;and financial reporting for state and local governments;A. Fund equity;B. Modified accrual basis;C. Reporting entity;D. Discrete presentation;E. Component unit;F. Accrual basis;G. Blended presentation;H. Governmental activities;For each of the following definitions, indicate the key term from the list;above that best matches by placing the appropriate letter in the blank space;next to the definition.;39. The;following are categories of funds described in Chapter 2;A. Governmental funds;B. Proprietary funds;C. Fiduciary funds;For each of the following descriptive phrases, indicate the type of fund from;the list above that best matches by placing the appropriate letter in the blank;space next to the phrase.;Essay Questions;40. "Generally;accepted accounting principles include both those principles established by the;Governmental Accounting Standards Board and those required by state laws.;Indicate whether this statement is true or false and explain why.;41. Explain;the difference between measurement focus and basis of accounting. Also, explain;the difference between the economic resources measurement focus and the current;financial resources measurement focus as well as the difference between the;accrual and modified accrual bases of accounting. Which funds and;government-wide activities use each focus and each basis?;42. "The;primary purpose of an accounting system for a state or a local government is to;make it possible for financial statements to demonstrate compliance with;finance-related legal and contractual provisions." Explain why you believe;this statement to be correct or incorrect.;43. Distinguish;between a blended presentation of financial data for a component unit and a;discrete presentation.;44. "Capital;assets of a government unit should always be reported on the same basis as a;business?depreciated historical cost." Do you agree? Why or why not?;45. Describe;the basic financial statements required by GASB standards and briefly explain;their purposes.;46. "Because;budgetary accounts are used by governments, their financial statements can;never be said to be in accord with generally accepted accounting;principles." Comment.;47. List;the seven fund financial statements that are required as part of the basic;financial statements by GASB standards. What measurement focus and basis of;accounting should be used in preparing each of these statements?;48. Explain;the nature of the three major activity categories of a state or local;government: governmental activities, business-type activities, and fiduciary;activities. Provide examples of each.;49. Describe;why a combining balance sheet might be prepared for governmental funds of a;government.;50. Describe;the comprehensive annual financial report (CAFR) described in the Annual;Financial Reports principle. What are the sections of the report and which;components of the organization should it include? Is a CAFR required?

 

Paper#45200 | Written in 18-Jul-2015

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