CGFM EXAM 2 STUDY GUIDE | COMPLETE
EXAM PREP, PRACTICE QUESTIONS AND
ANSWERS
| GRADED A+ | GUARANTEED SUCCESS
Updated 2026 Questions and Answers
100% Verified Exam Prep
,Committed Fund Balance Governing body formally committed net resources to specific activities. Contractual
obligations outstanding. Board approval of large construction contracts would typically
represent commitment of the funds.
Assigned Fund Balance Residual balances in funds other than the General Fund or in the general fund that are
intended for identified purposes
Difference between Committed and Restricted Committed constraint is imposed by a government upon itself
GASB standards state that rainy day funds may be classified as they are created by a resolution or ordinance that identifies the specific circumstances
committed only under specific circumstances which are under which the resources may be expended
Other financing sources consist of transfers in from other funds and proceeds of long-term borrowing
Fund Revenues consist of taxes, charges for services, amounts provided by other entities such as state or federal
government
Other fund uses Transfers of cash out of one fund to other funds
To recognize revenue from the General Fund transferred to a Credit General Fund Tax Revenue
debt service fund to record payments of interest and principal Debit General Fund Other Financing Uses-Transfers Out
on general obligation debt
Debit Debt Service Fund Other Financing Sources - Transfer In
Credit Debt Service Fund Expenditures
Fund Budgetary Accounts Estimated Revenues, Appropriations, Estimated Other Financing Sources, Estimated Other
Financing Uses, Encumbrances
Fund Activity Accounts Revenues, Expenditures, Other Financing Sources, Other Financing Uses
Fund Revenues Tax Revenues, Charges for Services
Fund Expenditures Current, Capital Outlay, Debt Service
Other Financing Sources Transfers In, Debt Proceeds
Other Financing Uses Transfers Out
, When a PO or Contract is issued as authorized by an An encumbrance (not yet a liability)
appropriation the government recognizes this commitment as
JE for City Council approves fiscal year budget for General DR Estimated Revenues
Fund CR Appropriations
JE for Financial Statement Accounts Budgetary Fund Balance is a CR
NONE
JE for City Departments issue PO for goods and services DR Encumbrances Control
JE for Financial Statement Accounts CR Budgetary Fund Balance Reserve for Encumbrances (To Establish the Encumbrance)
NONE
JE for Goods and Services are received and invoices are DR Budgetary Fund Balance Reserve for Encumbrances
presented for payment CR Encumbrances Control
JE for Financial Statement Accounts DR Expenditures (Current)
CR Accounts Payable (to Record the Liability)
Common form of nonexchange transactions tax revenue and intergovernmental grants
Nonexchange transaction eligibility requrements Characteristics/Time/Reimbursement/Contingencies-Matching funds
Imposed nonexchange transactions taxes and other assessments imposed by governemnts not derived from underlying
transactions. (Property Tax, special assessments, fines and forfeits)
Deferred taxes are reported as what on the Balance Sheet Reported as deferred inflows of resources
What are deferred taxes Taxes expected to be received more than 60 days after fiscal year end.
Derived Taxes taxes assessed on exchange transactions (sales taxes, income taxes, gasoline tax, excise
tax)
Revenues Inflows of net financial resources from sources other than inter-fund transfers and debt
proceeds.
Recognized when they are both measurable and available to finance current
expenditures
EXAM PREP, PRACTICE QUESTIONS AND
ANSWERS
| GRADED A+ | GUARANTEED SUCCESS
Updated 2026 Questions and Answers
100% Verified Exam Prep
,Committed Fund Balance Governing body formally committed net resources to specific activities. Contractual
obligations outstanding. Board approval of large construction contracts would typically
represent commitment of the funds.
Assigned Fund Balance Residual balances in funds other than the General Fund or in the general fund that are
intended for identified purposes
Difference between Committed and Restricted Committed constraint is imposed by a government upon itself
GASB standards state that rainy day funds may be classified as they are created by a resolution or ordinance that identifies the specific circumstances
committed only under specific circumstances which are under which the resources may be expended
Other financing sources consist of transfers in from other funds and proceeds of long-term borrowing
Fund Revenues consist of taxes, charges for services, amounts provided by other entities such as state or federal
government
Other fund uses Transfers of cash out of one fund to other funds
To recognize revenue from the General Fund transferred to a Credit General Fund Tax Revenue
debt service fund to record payments of interest and principal Debit General Fund Other Financing Uses-Transfers Out
on general obligation debt
Debit Debt Service Fund Other Financing Sources - Transfer In
Credit Debt Service Fund Expenditures
Fund Budgetary Accounts Estimated Revenues, Appropriations, Estimated Other Financing Sources, Estimated Other
Financing Uses, Encumbrances
Fund Activity Accounts Revenues, Expenditures, Other Financing Sources, Other Financing Uses
Fund Revenues Tax Revenues, Charges for Services
Fund Expenditures Current, Capital Outlay, Debt Service
Other Financing Sources Transfers In, Debt Proceeds
Other Financing Uses Transfers Out
, When a PO or Contract is issued as authorized by an An encumbrance (not yet a liability)
appropriation the government recognizes this commitment as
JE for City Council approves fiscal year budget for General DR Estimated Revenues
Fund CR Appropriations
JE for Financial Statement Accounts Budgetary Fund Balance is a CR
NONE
JE for City Departments issue PO for goods and services DR Encumbrances Control
JE for Financial Statement Accounts CR Budgetary Fund Balance Reserve for Encumbrances (To Establish the Encumbrance)
NONE
JE for Goods and Services are received and invoices are DR Budgetary Fund Balance Reserve for Encumbrances
presented for payment CR Encumbrances Control
JE for Financial Statement Accounts DR Expenditures (Current)
CR Accounts Payable (to Record the Liability)
Common form of nonexchange transactions tax revenue and intergovernmental grants
Nonexchange transaction eligibility requrements Characteristics/Time/Reimbursement/Contingencies-Matching funds
Imposed nonexchange transactions taxes and other assessments imposed by governemnts not derived from underlying
transactions. (Property Tax, special assessments, fines and forfeits)
Deferred taxes are reported as what on the Balance Sheet Reported as deferred inflows of resources
What are deferred taxes Taxes expected to be received more than 60 days after fiscal year end.
Derived Taxes taxes assessed on exchange transactions (sales taxes, income taxes, gasoline tax, excise
tax)
Revenues Inflows of net financial resources from sources other than inter-fund transfers and debt
proceeds.
Recognized when they are both measurable and available to finance current
expenditures
