ACCT 4421 Exam 1: ch 3 UPDATED
ACTUAL Exam Questions and CORRECT
Answers
T - CORRECT ANSWER - Capital budgets focus on plans for the acquisition and
construction of fixed assets
F - CORRECT ANSWER - the accounting cycle for most governments is 2 to 3 years,
consistent w the terms of elected officials
T - CORRECT ANSWER - most budgets are prepared on a cash or modified cash basis
T - CORRECT ANSWER - neither the GASB nor the FASB sets standards for budgetary
accounting
F - CORRECT ANSWER - state and local govt's must prepare their GAAP budgetary
comparisons on the modified accrual basis of accounting
T - CORRECT ANSWER - When budgets are integrated into a govt's accounting system,
estimated revenues are debited
T - CORRECT ANSWER - not-for-proit budgets focus first on revenues and secondarily
on expenditures
T - CORRECT ANSWER - state and local govt's budget-to-actual comparisons present
both original and final budget amounts
F - CORRECT ANSWER - Cash-basis budgets help govt's focus on inter-period equity
, T - CORRECT ANSWER - capital budgets concentrate on long-lived assets
C - CORRECT ANSWER - which event results in a debit to the encumbrances account?
a. The budget is approved.
b. Supplies are received.
c. A purchase order is placed.
d. An invoice is paid.
budgets - CORRECT ANSWER - are the key financial documents for govt's
1. planning
2. controlling and administering
3. reporting and evaluating - CORRECT ANSWER - key purposes of budgets?
general fund/special revenue - CORRECT ANSWER - ___________________ funds
usually require a legally adopted budget before taxes are collected and expenditures made
1. appropriation
2. capital
3. flexible
4. performance - CORRECT ANSWER - major types of budgets
appropriation budget - CORRECT ANSWER - major operating budget; monitors
current/operating revenues and expenditures (general fund); typically covers 1 operating cycle;
incorporates legislative granted expenditure authority; determines the amount of taxes;
appropriations can be 1. allocated for specific purpose and 2. allocated to be available for
specific time frames
ACTUAL Exam Questions and CORRECT
Answers
T - CORRECT ANSWER - Capital budgets focus on plans for the acquisition and
construction of fixed assets
F - CORRECT ANSWER - the accounting cycle for most governments is 2 to 3 years,
consistent w the terms of elected officials
T - CORRECT ANSWER - most budgets are prepared on a cash or modified cash basis
T - CORRECT ANSWER - neither the GASB nor the FASB sets standards for budgetary
accounting
F - CORRECT ANSWER - state and local govt's must prepare their GAAP budgetary
comparisons on the modified accrual basis of accounting
T - CORRECT ANSWER - When budgets are integrated into a govt's accounting system,
estimated revenues are debited
T - CORRECT ANSWER - not-for-proit budgets focus first on revenues and secondarily
on expenditures
T - CORRECT ANSWER - state and local govt's budget-to-actual comparisons present
both original and final budget amounts
F - CORRECT ANSWER - Cash-basis budgets help govt's focus on inter-period equity
, T - CORRECT ANSWER - capital budgets concentrate on long-lived assets
C - CORRECT ANSWER - which event results in a debit to the encumbrances account?
a. The budget is approved.
b. Supplies are received.
c. A purchase order is placed.
d. An invoice is paid.
budgets - CORRECT ANSWER - are the key financial documents for govt's
1. planning
2. controlling and administering
3. reporting and evaluating - CORRECT ANSWER - key purposes of budgets?
general fund/special revenue - CORRECT ANSWER - ___________________ funds
usually require a legally adopted budget before taxes are collected and expenditures made
1. appropriation
2. capital
3. flexible
4. performance - CORRECT ANSWER - major types of budgets
appropriation budget - CORRECT ANSWER - major operating budget; monitors
current/operating revenues and expenditures (general fund); typically covers 1 operating cycle;
incorporates legislative granted expenditure authority; determines the amount of taxes;
appropriations can be 1. allocated for specific purpose and 2. allocated to be available for
specific time frames
