Governmental Accounting Ch. 10-14
(Answered) 100% Correct
-Which of the following terms is defined as determining whether current-year revenues
are sufficient to pay for current-year services and whether future taxpayers will be
required to assume the burdens of services previously provided?
{{{Answer}}} (Interperiod equity.)
-Which ratio or concept describes the extent to which the government has lived within
its means for the year?
{{{Answer}}} (Interperiod equity.)
-The three major rating agencies for governments have each developed quantitative
tools for assessing credit risk. Which of the following general factors is used by all three
rating agencies in assessing credit risk?
{{{Answer}}} (Economy)
-A measure of whether the government lived within its means in the measurement year,
was required to use prior year resources to fund a portion of current year costs, or
shifted the funding of some current year costs to future periods, is:
{{{Answer}}} (Total revenues/total expenditures.)
-Evaluation of government financial performance is important for which of the following
reasons?
{{{Answer}}} (Investors use it to make decisions about bond investments.)
-Which of the following terms or concepts focuses primarily on a government's ability to
generate enough cash over a 30- or 60-day period to pay its bills?
{{{Answer}}} (Cash solvency.)
-Why does GASB prefer to use the term economic condition rather than financial
condition?
{{{Answer}}} (Economic condition focuses on both the ability and willingness to meet
financial and service obligations.)
-Factors that influence a government's financial condition include which of the following?
{{{Answer}}} (financial, organizational, environmental)
-Which of the following environmental factors reveals the entity's underlying
philosophies regarding willingness to support higher taxes, issuances of long-term debt,
and increased social services?
{{{Answer}}} (Political culture.)
, -Which of the following would be an effective means of benchmarking?
{{{Answer}}} (Comparing current-period ratios to published medians of the same ratios
for cities of similar size or in the same geographic region.)
-Rating agencies, such as FitchRatings, Moody's Investor Service and Standard &
Poor's, produce bond ratings that
{{{Answer}}} (focus both on quantitative and qualitative factors using proprietary
models.)
-Which of the following suggests a government that is relying primarily on revenues it
directly controls?
{{{Answer}}} (Property taxes, 20%; charges for services, 70%; grants and contributions,
5%; investment income, 5%.)
-What is Electronic Municipal Market Access or EMMA?
{{{Answer}}} (An online service that allows users to learn more about the municipal
securities market.)
-Which of the following is a measure of the extent to which the government's business-
type activities are self-supporting?
{{{Answer}}} (Business-type activities revenues/business-type activities expenses.)
-After financial ratios are calculated, the results should be compared to any of the
following except:
{{{Answer}}} (Budgeted information for the government for the upcoming year.)
-Which of the following ratios would be most helpful in assessing the operating position
of a governmental entity?
{{{Answer}}} (General fund balance/operating revenues.)
-Which of the following financial concepts has been defined by the GASB as "the
probability that a government will meet both its financial obligations to creditors,
consumers, employees, taxpayers, suppliers, constituents, and others as they become
due and its service obligation to constituents, both currently and in the future"?
{{{Answer}}} (financial condition)
-A measure of the adequacy of the amount of the government's total unrestricted net
position or deficit at the measurement date is:
{{{Answer}}} (Unrestricted net position/total revenues.)
-Which of the following statements about credit analysts' models is true?
{{{Answer}}} (Credit analysts are concerned with assessing a government's ability to pay
interest and principal on debt when due.)
-The term that is closely related to the concept of liquidity is
(Answered) 100% Correct
-Which of the following terms is defined as determining whether current-year revenues
are sufficient to pay for current-year services and whether future taxpayers will be
required to assume the burdens of services previously provided?
{{{Answer}}} (Interperiod equity.)
-Which ratio or concept describes the extent to which the government has lived within
its means for the year?
{{{Answer}}} (Interperiod equity.)
-The three major rating agencies for governments have each developed quantitative
tools for assessing credit risk. Which of the following general factors is used by all three
rating agencies in assessing credit risk?
{{{Answer}}} (Economy)
-A measure of whether the government lived within its means in the measurement year,
was required to use prior year resources to fund a portion of current year costs, or
shifted the funding of some current year costs to future periods, is:
{{{Answer}}} (Total revenues/total expenditures.)
-Evaluation of government financial performance is important for which of the following
reasons?
{{{Answer}}} (Investors use it to make decisions about bond investments.)
-Which of the following terms or concepts focuses primarily on a government's ability to
generate enough cash over a 30- or 60-day period to pay its bills?
{{{Answer}}} (Cash solvency.)
-Why does GASB prefer to use the term economic condition rather than financial
condition?
{{{Answer}}} (Economic condition focuses on both the ability and willingness to meet
financial and service obligations.)
-Factors that influence a government's financial condition include which of the following?
{{{Answer}}} (financial, organizational, environmental)
-Which of the following environmental factors reveals the entity's underlying
philosophies regarding willingness to support higher taxes, issuances of long-term debt,
and increased social services?
{{{Answer}}} (Political culture.)
, -Which of the following would be an effective means of benchmarking?
{{{Answer}}} (Comparing current-period ratios to published medians of the same ratios
for cities of similar size or in the same geographic region.)
-Rating agencies, such as FitchRatings, Moody's Investor Service and Standard &
Poor's, produce bond ratings that
{{{Answer}}} (focus both on quantitative and qualitative factors using proprietary
models.)
-Which of the following suggests a government that is relying primarily on revenues it
directly controls?
{{{Answer}}} (Property taxes, 20%; charges for services, 70%; grants and contributions,
5%; investment income, 5%.)
-What is Electronic Municipal Market Access or EMMA?
{{{Answer}}} (An online service that allows users to learn more about the municipal
securities market.)
-Which of the following is a measure of the extent to which the government's business-
type activities are self-supporting?
{{{Answer}}} (Business-type activities revenues/business-type activities expenses.)
-After financial ratios are calculated, the results should be compared to any of the
following except:
{{{Answer}}} (Budgeted information for the government for the upcoming year.)
-Which of the following ratios would be most helpful in assessing the operating position
of a governmental entity?
{{{Answer}}} (General fund balance/operating revenues.)
-Which of the following financial concepts has been defined by the GASB as "the
probability that a government will meet both its financial obligations to creditors,
consumers, employees, taxpayers, suppliers, constituents, and others as they become
due and its service obligation to constituents, both currently and in the future"?
{{{Answer}}} (financial condition)
-A measure of the adequacy of the amount of the government's total unrestricted net
position or deficit at the measurement date is:
{{{Answer}}} (Unrestricted net position/total revenues.)
-Which of the following statements about credit analysts' models is true?
{{{Answer}}} (Credit analysts are concerned with assessing a government's ability to pay
interest and principal on debt when due.)
-The term that is closely related to the concept of liquidity is
