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13) Several years ago, Durham City issued $1 milli...

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13) Several years ago, Durham City issued $1 million in zero coupon bonds due and payable in 2010. The bonds were sold at an amount to yield investors 6% over the life of the bonds. During the current year, how much interest expenditures would Durham City recognize related to these bonds? A. Difference between the present value of the bonds at the beginning of the period and the present value of the bonds at the end of the period B. None C. Face amounts of bonds times 6% D. Book value of bonds times 6% 14) As used in governmental accounting, expenditures are decreases in A. Net Assets. B. Net Economic Resources. C. Net Financial Resources. D. Net Cash. 15) Which of the following funds would use the modified accrual basis of accounting in preparing its fund financial statements? A. City Motor Pool Internal Service Fund B. City Employee Pension Trust Fund C. City Hall Capital Project Fund D. City Electric Utility Enterprise Fund 16) Employees of the City of Orleans earn 10 days paid leave for each 12 months of employment. The city has a policy that employees must take their vacation days during the year following the year in which it is earned. If they do NOT take vacation in the allotted period, they forfeit the benefit. Traditionally, employees have taken 80% of the vacation days earned. During the current year, employees earned $400,000 in vacation pay. Assuming the city maintains its records in a manner to facilitate the preparation of its fund financial statements, which of the following entries is the correct entry in the General Fund to record the vacation pay earned during the current period? A. Debit Expenditures: $320,000; Credit Vacation Pay Payable: $320,000 B. No entry required. C. Debit Expenses: $400,000; Credit Vacation Payable: $400,000 D. Debit Expenditures: $400,000; Credit Vacation Payable: $400,000 17) Employees of the General Fund of Scott City earn 10 days of vacation for each 12 months of employment. The city permits employees to carry the vacation days forward as long as they wish. During the current year, employees earned $800,000 of vacation benefits, of which the city estimates that $500,000 will be taken in the next year, with the balance being carried forward. Assuming that the city maintains its records in a manner that facilitates the preparation of its fund financial statements, which of the following entries is the correct entry in the General Fund to record the vacation pay earned during the current period? A. Debit Vacation Expense: $800,000; Credit Vacation Pay Payable: $800,000 B. No entry required. C. Debit Expenditures: $500,000; Credit Vacation Pay Payable: $500,000 D. Debit Expenditures: $800,000; Credit Vacation Pay Payable: $800,000 18) Assume the City of Juneau maintains its records to facilitate the preparation of its government-wide financial statements. The city pays its employees biweekly on Friday. The fiscal year ended on Wednesday, June 30. Employees were paid on Friday, June 25. The employees paid from the General Fund earned $120,000 on Monday, Tuesday, and Wednesday (June 28, 29, and 30). They will earn $80,000 on Thursday and Friday (July 1 and 2). What entry, if any, should be made on June 30? A. Debit Expenses: $120,000; Credit Wages and Salaries Payable: $120,000 B. No entry is required. C. Debit Expenditure: $200,000; Credit Wages and Salaries Payable: $200,000 D. Debit Expenditures: $120,000; Credit Wages and Salaries Payable: $120,000 19) As used in defining the modified accrual basis of accounting, the term available means A. collection in cash is reasonably assured. B. collected within the current period or expected to be collected soon enough to pay liabilities of the current period. C. will be received in cash within 60 days of year?s end. D. received in cash. 20) Under the modified accrual basis of accounting, derived nonexchange revenues are recognized when A. the underlying exchange transaction occurs. B. the underlying exchange transaction occurs, and they are measurable and available to finance expenditures of the current period. C. they are measurable and available to finance expenditures of the current period. D. they are earned. 21) The modified accrual basis of accounting is used in presenting the fund financial statements of governmental funds because it A. is the superior method of accounting for the economic resources of any entity. B. provides information as to whether or not the entity achieved interperiod equity. C. is budget-oriented while facilitating comparisons among entities. D. results in accounting measurements based on the substance of transactions.

 

Paper#9396 | Written in 18-Jul-2015

Price : $25
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