Illinois Accountant Exam (CMS)
Newest 2026- 2027 Updated
Practice Exam | 100 Actual
Most Tested Questions
Collections & Verified Detailed
Answers | Tutor Verified
Success Exam) Graded A+
1. A state agency prepares financial statements under governmental
accounting standards. Which framework is primarily used?
A. IFRS
B. GASB standards
C. FASB private sector standards
D. IRS guidelines
Correct Answer: B ✔
Rationale: Government entities in the U.S. primarily follow GASB (Governmental
Accounting Standards Board) standards for financial reporting.
2. Which fund is used to account for resources that are legally restricted for
specific purposes?
A. General Fund
B. Special Revenue Fund
, C. Debt Service Fund
D. Agency Fund
Correct Answer: B ✔
Rationale: A Special Revenue Fund is used for resources that are restricted by
law or external donors.
3. What is the primary purpose of a trial balance?
A. To determine tax liability
B. To ensure debits equal credits
C. To calculate net income
D. To prepare cash flow statements
Correct Answer: B ✔
Rationale: A trial balance ensures accounting equation balance by confirming
total debits equal total credits.
4. Which financial statement shows revenues and expenses?
A. Balance Sheet
B. Statement of Net Position
C. Income Statement
D. Statement of Cash Flows
Correct Answer: C ✔
Rationale: The Income Statement reports revenues, expenses, and net income.
5. What is the accounting equation?
A. Assets = Liabilities + Equity
B. Assets = Revenue + Expenses
C. Assets = Cash + Inventory
D. Liabilities = Assets + Equity
Correct Answer: A ✔
Rationale: The fundamental equation is Assets = Liabilities + Equity.
6. Which of the following is a current asset?
A. Building
, B. Equipment
C. Accounts Receivable
D. Land
Correct Answer: C ✔
Rationale: Accounts Receivable is expected to be collected within one year,
making it a current asset.
7. A government budget is best described as:
A. A legal spending plan
B. A tax audit report
C. A financial statement summary
D. A revenue recognition method
Correct Answer: A ✔
Rationale: A budget is a legally adopted financial plan for public spending.
8. Which accounting principle requires expenses to be matched with
revenues?
A. Cost Principle
B. Matching Principle
C. Revenue Recognition Principle
D. Full Disclosure Principle
Correct Answer: B ✔
Rationale: The Matching Principle ensures expenses are recorded in the same
period as related revenues.
9. What type of audit provides assurance on financial statements?
A. Operational audit
B. Performance audit
C. Financial audit
D. Compliance audit
Correct Answer: C ✔
Rationale: A financial audit evaluates fairness of financial statements.
Newest 2026- 2027 Updated
Practice Exam | 100 Actual
Most Tested Questions
Collections & Verified Detailed
Answers | Tutor Verified
Success Exam) Graded A+
1. A state agency prepares financial statements under governmental
accounting standards. Which framework is primarily used?
A. IFRS
B. GASB standards
C. FASB private sector standards
D. IRS guidelines
Correct Answer: B ✔
Rationale: Government entities in the U.S. primarily follow GASB (Governmental
Accounting Standards Board) standards for financial reporting.
2. Which fund is used to account for resources that are legally restricted for
specific purposes?
A. General Fund
B. Special Revenue Fund
, C. Debt Service Fund
D. Agency Fund
Correct Answer: B ✔
Rationale: A Special Revenue Fund is used for resources that are restricted by
law or external donors.
3. What is the primary purpose of a trial balance?
A. To determine tax liability
B. To ensure debits equal credits
C. To calculate net income
D. To prepare cash flow statements
Correct Answer: B ✔
Rationale: A trial balance ensures accounting equation balance by confirming
total debits equal total credits.
4. Which financial statement shows revenues and expenses?
A. Balance Sheet
B. Statement of Net Position
C. Income Statement
D. Statement of Cash Flows
Correct Answer: C ✔
Rationale: The Income Statement reports revenues, expenses, and net income.
5. What is the accounting equation?
A. Assets = Liabilities + Equity
B. Assets = Revenue + Expenses
C. Assets = Cash + Inventory
D. Liabilities = Assets + Equity
Correct Answer: A ✔
Rationale: The fundamental equation is Assets = Liabilities + Equity.
6. Which of the following is a current asset?
A. Building
, B. Equipment
C. Accounts Receivable
D. Land
Correct Answer: C ✔
Rationale: Accounts Receivable is expected to be collected within one year,
making it a current asset.
7. A government budget is best described as:
A. A legal spending plan
B. A tax audit report
C. A financial statement summary
D. A revenue recognition method
Correct Answer: A ✔
Rationale: A budget is a legally adopted financial plan for public spending.
8. Which accounting principle requires expenses to be matched with
revenues?
A. Cost Principle
B. Matching Principle
C. Revenue Recognition Principle
D. Full Disclosure Principle
Correct Answer: B ✔
Rationale: The Matching Principle ensures expenses are recorded in the same
period as related revenues.
9. What type of audit provides assurance on financial statements?
A. Operational audit
B. Performance audit
C. Financial audit
D. Compliance audit
Correct Answer: C ✔
Rationale: A financial audit evaluates fairness of financial statements.
