Acct 4421 Midterm Review Questions and
Answers 100% Solved
Which of the following is not one of the seven elements defined by the GASB concept
statements? Expenses
The Financial Accounting Standards Board has the responsibility for setting accounting and
financial reporting standards for which of the following? All not-for-profit organizations
that are nongovernmental and business entities.
Which of the following would be considered a general capital asset? A vehicle purchased
from General Fund revenues.
Expenditures and expenses are classified as which of the following elements under GASB
concepts statements? Outflows of resources.
Use the following information to determine whether the Development Special Revenue and the
Debt Service Funds should be reported as major funds based on asset amounts provided.
Development Special Revenue Fund Assets $740,000
,Debt Service Fund Assets$150,000
Total Governmental Fund Assets $7,500,000
Total Governmental Fund and Enterprise Fund Assets $8,750,000 Neither the
Development Special Revenue Fund nor the Debt Service Fund should be reported as major.
A comprehensive annual financial report (CAFR) prepared in conformity with the GASB
recommendations should include which of the following sections? Introductory, financial,
and statistical.
Which of the following should not be reported on the balance sheet of the General Fund?
Equipment.
Which of the following statements is true regarding bond anticipation notes? Bond
anticipation notes can be reported as short-term liabilities in the governmental fund financial
statements.
Which of the following groups is considered a primary user of a state or local government's
general-purpose external financial statements? Citizens
,Which of the following standard-setting bodies requires a management's discussion and analysis
as a part of the financial report? Both GASB and FASAB.
Which of the following funds would record depreciation of capital assets? Internal
Service Fund
On May 1, the City of Spencer was notified of approval of a $300,000 federal operating grant,
payable on a reimbursement basis as the city expends resources for the intended purpose of the
grant. As of May 1, no expenditures had been made for grant purposes. The journal entry to
record approval of this grant will include: No journal entry will be made until authorized
expenditures occur.
Which of the following assets would not be found in the balance sheet of a debt service fund?
Equipment
Supplies recorded in the General Fund under the purchases method will initially include a
Debit to Expenditures
, 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 government on
a cost-reimbursement basis? Internal Service Fund
When equipment is ordered by a department of the government, the purchase order should be
recorded in the General Fund as a debit to: Encumbrances
Which of the following is not a characteristic of a fund as defined by GASB standards? A
reporting entity.
A city recorded an asset impairment to a public works facility. Which of the following is correct
concerning the recording of the amount of the asset impairment? The governmental
activities accounts would record a debit to Expenses—Public Works.
Typically, proceeds from general obligation bonds will be recorded in the: Capital
projects fund
A major governmental fund is one that has one or more elements (e.g., assets, liabilities,
revenues, or expenditures) that is at least: Ten percent of the corresponding element(s) of
Answers 100% Solved
Which of the following is not one of the seven elements defined by the GASB concept
statements? Expenses
The Financial Accounting Standards Board has the responsibility for setting accounting and
financial reporting standards for which of the following? All not-for-profit organizations
that are nongovernmental and business entities.
Which of the following would be considered a general capital asset? A vehicle purchased
from General Fund revenues.
Expenditures and expenses are classified as which of the following elements under GASB
concepts statements? Outflows of resources.
Use the following information to determine whether the Development Special Revenue and the
Debt Service Funds should be reported as major funds based on asset amounts provided.
Development Special Revenue Fund Assets $740,000
,Debt Service Fund Assets$150,000
Total Governmental Fund Assets $7,500,000
Total Governmental Fund and Enterprise Fund Assets $8,750,000 Neither the
Development Special Revenue Fund nor the Debt Service Fund should be reported as major.
A comprehensive annual financial report (CAFR) prepared in conformity with the GASB
recommendations should include which of the following sections? Introductory, financial,
and statistical.
Which of the following should not be reported on the balance sheet of the General Fund?
Equipment.
Which of the following statements is true regarding bond anticipation notes? Bond
anticipation notes can be reported as short-term liabilities in the governmental fund financial
statements.
Which of the following groups is considered a primary user of a state or local government's
general-purpose external financial statements? Citizens
,Which of the following standard-setting bodies requires a management's discussion and analysis
as a part of the financial report? Both GASB and FASAB.
Which of the following funds would record depreciation of capital assets? Internal
Service Fund
On May 1, the City of Spencer was notified of approval of a $300,000 federal operating grant,
payable on a reimbursement basis as the city expends resources for the intended purpose of the
grant. As of May 1, no expenditures had been made for grant purposes. The journal entry to
record approval of this grant will include: No journal entry will be made until authorized
expenditures occur.
Which of the following assets would not be found in the balance sheet of a debt service fund?
Equipment
Supplies recorded in the General Fund under the purchases method will initially include a
Debit to Expenditures
, 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 government on
a cost-reimbursement basis? Internal Service Fund
When equipment is ordered by a department of the government, the purchase order should be
recorded in the General Fund as a debit to: Encumbrances
Which of the following is not a characteristic of a fund as defined by GASB standards? A
reporting entity.
A city recorded an asset impairment to a public works facility. Which of the following is correct
concerning the recording of the amount of the asset impairment? The governmental
activities accounts would record a debit to Expenses—Public Works.
Typically, proceeds from general obligation bonds will be recorded in the: Capital
projects fund
A major governmental fund is one that has one or more elements (e.g., assets, liabilities,
revenues, or expenditures) that is at least: Ten percent of the corresponding element(s) of
