GOVERNMENT AND NOT-FOR-PROFIT
ACCOUNTING CONCEPTS AND PRACTICES
8TH EDITION MICHAEL GRANOF SALEHA
KHUMAWALA THAD CALABRESE DANIEL
SOLUTION MANUAL FINAL STUDY GUIDE
2026 SOLVED QUESTIONS FULLY CORRECT
⫸ T or F: proprietary funds record expenses, not expenditures Answer:
T
⫸ What basis of accounting do enterprise and internal service funds
use? Answer: full accrual basis of accounting
⫸ Which of the following is not a GASB‐required statement for
proprietary funds?
a. statement of net position
b. statement of revenues, expenses, and changes in fund net position
c. statement of cash flows
d. statement of changes in fund net position Answer: statement of
changes in fund net position
⫸ A government need not necessarily account for an activity in an
enterprise fund even though it
a. charges fees for the activity.
b. finances the activity solely with revenue debt
, c. is required by law or policy to recover the cost of the activity by fees
d. opt to establish pricing policies to recover its costs, including capital
costs Answer: charges fees for the activity and those fees are material in
amount
⫸ tap fees, to the extent that they do not exceed the cost of hooking
customers into the utility, should be accounted for as: Answer: ordinary
revenues (exchange transaction)
⫸ Tap fees, a portion of which exceed the cost of hooking customers
into the utility, should be accounted for as Answer: a combination of
capital contributions and ordinary revenues (nonexchainge transaction)
⫸ Landfill closure and postclosure costs should be recognized as
expenses Answer: in the periods in which the landfill is in operation
(promotes interperiod equity)
⫸ Which of the following would not be included in the computation of
the amount to be recognized as a landfill closure expense?
a. total estimated closure costs
b. the capacity of the landfill
c. the proportion of capacity used in prior years
d. an appropriate discount rate Answer: an appropriate discount rate
⫸ A city maintains a staff of internal auditors. It may properly account
for its internal audit costs in an internal service fund only if
ACCOUNTING CONCEPTS AND PRACTICES
8TH EDITION MICHAEL GRANOF SALEHA
KHUMAWALA THAD CALABRESE DANIEL
SOLUTION MANUAL FINAL STUDY GUIDE
2026 SOLVED QUESTIONS FULLY CORRECT
⫸ T or F: proprietary funds record expenses, not expenditures Answer:
T
⫸ What basis of accounting do enterprise and internal service funds
use? Answer: full accrual basis of accounting
⫸ Which of the following is not a GASB‐required statement for
proprietary funds?
a. statement of net position
b. statement of revenues, expenses, and changes in fund net position
c. statement of cash flows
d. statement of changes in fund net position Answer: statement of
changes in fund net position
⫸ A government need not necessarily account for an activity in an
enterprise fund even though it
a. charges fees for the activity.
b. finances the activity solely with revenue debt
, c. is required by law or policy to recover the cost of the activity by fees
d. opt to establish pricing policies to recover its costs, including capital
costs Answer: charges fees for the activity and those fees are material in
amount
⫸ tap fees, to the extent that they do not exceed the cost of hooking
customers into the utility, should be accounted for as: Answer: ordinary
revenues (exchange transaction)
⫸ Tap fees, a portion of which exceed the cost of hooking customers
into the utility, should be accounted for as Answer: a combination of
capital contributions and ordinary revenues (nonexchainge transaction)
⫸ Landfill closure and postclosure costs should be recognized as
expenses Answer: in the periods in which the landfill is in operation
(promotes interperiod equity)
⫸ Which of the following would not be included in the computation of
the amount to be recognized as a landfill closure expense?
a. total estimated closure costs
b. the capacity of the landfill
c. the proportion of capacity used in prior years
d. an appropriate discount rate Answer: an appropriate discount rate
⫸ A city maintains a staff of internal auditors. It may properly account
for its internal audit costs in an internal service fund only if
