Governmental Accounting Questions &
correct answers respectively.
Which of the following is true of the governmental environment?
A. The federal government has primary authority for national and international affairs.
B. The federal government has all powers not set out in the U.S. Constitution. ANS -A. The federal
government has primary authority for national and international affairs.
B. Incorrect- These powers are left to the states.
Which of the following is true concerning accountability in government?
A. Public officials have to be accountable to the citizens.
B. Financial reporting plays a minor role in fulfilling government accountability. ANS -A. Public officials
have to be accountable to the citizens.
B. Incorrect- This plays a major role in government
Which of the following is true about interperiod equity?
A. Current-year services should be financed with current-year revenues.
B. Current-year services may be financed with long-term funds. ANS -A. Current-year services should be
financed with current-year revenues
B. Incorrect- Current- year services should not be financed with long-term funds.
Which of the following is true concerning economic resources measurement focus?
A. Fixed assets are capitalized and depreciated
B. fixed assets are expensed when purchase. ANS -A. fixed assets are capitalized and depreciated.
B. Incorrect-Current resources measurement does not require full accrual.
, Which of the following is true concerning cost accounting in government?
A. Cost accounting consists of direct cost and indirect costs.
B. Cost accounting is a form of generally accepted accounting principles. ANS -A. cost accounting
consists of direct cost and indirect costs.
B. Incorrect- Cost accounting is a type of managerial accounting as is not GAAP.
Which of the following is true concerning determining allowable cost by state and local governments
receiving federal grants?
A State and local governments must follow OMB Circular A-21.
B. state and local governments must follow OMB Circular A-87 ANS -A. Incorrect- OMB Circular A-21
must be followed by universities and colleges
B. State and local governments must follow OMB circular A-87
Which of the following is true concerning determining allowable cost by government universities?
A. Government universities and colleges must follow OMB Circular A-21
B. Government universities and colleges must follow OMB Circular A-122 ANS -A. government and
universities and colleges must follow OMB Circular A-21
B. Incorrect- OMB Circular 122- must be followed by non-profit organizations.
Which of the following is true concerning fund accounting and reporting for state and local
governments?
A. Funds are intended to stand alone
B. Funds are not intended to stand alone ANS -A. Funds are intended to stand alone.
B. Incorrect- Required to stand alone by GASB.
correct answers respectively.
Which of the following is true of the governmental environment?
A. The federal government has primary authority for national and international affairs.
B. The federal government has all powers not set out in the U.S. Constitution. ANS -A. The federal
government has primary authority for national and international affairs.
B. Incorrect- These powers are left to the states.
Which of the following is true concerning accountability in government?
A. Public officials have to be accountable to the citizens.
B. Financial reporting plays a minor role in fulfilling government accountability. ANS -A. Public officials
have to be accountable to the citizens.
B. Incorrect- This plays a major role in government
Which of the following is true about interperiod equity?
A. Current-year services should be financed with current-year revenues.
B. Current-year services may be financed with long-term funds. ANS -A. Current-year services should be
financed with current-year revenues
B. Incorrect- Current- year services should not be financed with long-term funds.
Which of the following is true concerning economic resources measurement focus?
A. Fixed assets are capitalized and depreciated
B. fixed assets are expensed when purchase. ANS -A. fixed assets are capitalized and depreciated.
B. Incorrect-Current resources measurement does not require full accrual.
, Which of the following is true concerning cost accounting in government?
A. Cost accounting consists of direct cost and indirect costs.
B. Cost accounting is a form of generally accepted accounting principles. ANS -A. cost accounting
consists of direct cost and indirect costs.
B. Incorrect- Cost accounting is a type of managerial accounting as is not GAAP.
Which of the following is true concerning determining allowable cost by state and local governments
receiving federal grants?
A State and local governments must follow OMB Circular A-21.
B. state and local governments must follow OMB Circular A-87 ANS -A. Incorrect- OMB Circular A-21
must be followed by universities and colleges
B. State and local governments must follow OMB circular A-87
Which of the following is true concerning determining allowable cost by government universities?
A. Government universities and colleges must follow OMB Circular A-21
B. Government universities and colleges must follow OMB Circular A-122 ANS -A. government and
universities and colleges must follow OMB Circular A-21
B. Incorrect- OMB Circular 122- must be followed by non-profit organizations.
Which of the following is true concerning fund accounting and reporting for state and local
governments?
A. Funds are intended to stand alone
B. Funds are not intended to stand alone ANS -A. Funds are intended to stand alone.
B. Incorrect- Required to stand alone by GASB.
