CGFM EXAM 2 QUESTIONS AND
ANSWERS
Special assessments are used to ensure that - Answers -individuals benefiting from the
project are the ones who will pay for it
imputed costs - Answers -costs incurred by a federal entity for goods and services
provided and paid for in total, or in part, by other federal entities
Accumulated Depreciation is which type of account - Answers -contra asset
Preferred Costing Methodology - Answers -Directly tracing costs wherever feasible and
economically practical
due process document describing various methods of accounting for a transaction and
asks respondents to provide their views on the preferred method - Answers -discussion
memorandum
What is the correct accounting entry when one government agency receives a grant
from another government agency? - Answers -The grantor agency recognizes liability
and the recipient agency recognizes non-exchange revenue when the recipient agency
meets all eligibility requirements.
GASB, FASB, and FASAB have been designated standard-setting bodies for
accounting and reporting standards by the - Answers -AICPA
Federal appropriations provide a legal authority for undertaking programs, allocating
resources, and - Answers -expending funds
Federal appropriations law can be categorized into which three topical areas? -
Answers -Purpose, time, and amount (PTA)
What are the basic types of budget authority used in the Federal Government? (6) -
Answers -1. Appropriations
2. Contract Authority
3. Borrowing Authority
4. Monetary Credits
5. Offsetting Collections and Receipts
6. Loan and Loan Guarantee Authority
, In financial reporting, consistency of communication means - Answers -if accounting
principles have changed or if the financial reporting entity has changed, the nature and
reason for the change, as well as the effect of the change, should be disclosed.
Budgeting is an element of which policy? - Answers -fiscal
Another term for the federal government baseline budget is - Answers -a current level of
service budget.
As described by FASAB, the four groups of people to whom the government is
accountable and are, therefore, potential users of federal financial statements are -
Answers -citizens, Congress, executives, and program managers.
When establishing an allowance for doubtful accounts, the journal entry required is a
debit to - Answers -Bad Debts Expense and a credit to the Allowance for Doubtful
Accounts.
Street resurfacing is a type of which budget element? - Answers -program
Which of the following sources of accounting principles is at the top of the GASB
hierarchy? - Answers -Generally Accepted Accounting Principles
The role of the International Public Sector Accounting Standards Board is to - Answers -
set standards for the general purpose financial statements of international public sector
entities.
Non-exchange revenue includes inflows of resources arising from - Answers -taxes,
fines and penalties from the private sector.
A group of activities within a function are known as - Answers -a program
The organizations that establish the standards used by their constituents for external
reporting purposes include FASB, FASAB, GASB and - Answers -International Public
Sector Accounting Standards Board
Which of the following terms describes costs an agency incurs on behalf of another
agency? - Answers -inter-entity
State and local governments need cost information to receive reimbursements for
allowable costs for federal grants, while federal agencies are required to have cost
accounting concepts in the preparation of what type of statements? - Answers -financial
statements
State and local governments use encumbrances as the major budgetary control tool to
ensure availability of funds prior to entering agreements, while the federal government
instills budgetary control using - Answers -commitments and obligations.
ANSWERS
Special assessments are used to ensure that - Answers -individuals benefiting from the
project are the ones who will pay for it
imputed costs - Answers -costs incurred by a federal entity for goods and services
provided and paid for in total, or in part, by other federal entities
Accumulated Depreciation is which type of account - Answers -contra asset
Preferred Costing Methodology - Answers -Directly tracing costs wherever feasible and
economically practical
due process document describing various methods of accounting for a transaction and
asks respondents to provide their views on the preferred method - Answers -discussion
memorandum
What is the correct accounting entry when one government agency receives a grant
from another government agency? - Answers -The grantor agency recognizes liability
and the recipient agency recognizes non-exchange revenue when the recipient agency
meets all eligibility requirements.
GASB, FASB, and FASAB have been designated standard-setting bodies for
accounting and reporting standards by the - Answers -AICPA
Federal appropriations provide a legal authority for undertaking programs, allocating
resources, and - Answers -expending funds
Federal appropriations law can be categorized into which three topical areas? -
Answers -Purpose, time, and amount (PTA)
What are the basic types of budget authority used in the Federal Government? (6) -
Answers -1. Appropriations
2. Contract Authority
3. Borrowing Authority
4. Monetary Credits
5. Offsetting Collections and Receipts
6. Loan and Loan Guarantee Authority
, In financial reporting, consistency of communication means - Answers -if accounting
principles have changed or if the financial reporting entity has changed, the nature and
reason for the change, as well as the effect of the change, should be disclosed.
Budgeting is an element of which policy? - Answers -fiscal
Another term for the federal government baseline budget is - Answers -a current level of
service budget.
As described by FASAB, the four groups of people to whom the government is
accountable and are, therefore, potential users of federal financial statements are -
Answers -citizens, Congress, executives, and program managers.
When establishing an allowance for doubtful accounts, the journal entry required is a
debit to - Answers -Bad Debts Expense and a credit to the Allowance for Doubtful
Accounts.
Street resurfacing is a type of which budget element? - Answers -program
Which of the following sources of accounting principles is at the top of the GASB
hierarchy? - Answers -Generally Accepted Accounting Principles
The role of the International Public Sector Accounting Standards Board is to - Answers -
set standards for the general purpose financial statements of international public sector
entities.
Non-exchange revenue includes inflows of resources arising from - Answers -taxes,
fines and penalties from the private sector.
A group of activities within a function are known as - Answers -a program
The organizations that establish the standards used by their constituents for external
reporting purposes include FASB, FASAB, GASB and - Answers -International Public
Sector Accounting Standards Board
Which of the following terms describes costs an agency incurs on behalf of another
agency? - Answers -inter-entity
State and local governments need cost information to receive reimbursements for
allowable costs for federal grants, while federal agencies are required to have cost
accounting concepts in the preparation of what type of statements? - Answers -financial
statements
State and local governments use encumbrances as the major budgetary control tool to
ensure availability of funds prior to entering agreements, while the federal government
instills budgetary control using - Answers -commitments and obligations.
