Governmental Accounting--Exam #1
correctly answered graded A+ already
passed
Expenditures - correct answer ✔✔Are the foundation of planning, authorizing,
controlling, and evaluating activities of governmental funds. It's a measure of the
fund liabilities incurred (or expendable financial resources used). Typically
classified as operations, capital outlay, or debt service.
When to Recognize Expenditures - correct answer ✔✔In the accounting period in
which the fund liability is incurred except for unmatured interest (and principal)
on long-term debt, which is recognized when due.
Inventory Expenditures - correct answer ✔✔May be recognized using either
purchases method or consumption method.
Prepayment Expenditures - correct answer ✔✔May be allocated over benefited
period or accounted for only in current period.
Pension Cost Expenditures - correct answer ✔✔Payments to pension plans, even
self-administered ones, qualify as expenditures; most govt's either use defined
contribution or defined benefit contribution.
Defined Contribution Plan - correct answer ✔✔Government obligation is limited
to making contributions required by the plan; retiree benefits dependent upon
contributions made and the investment performance of the plan. Government
, should recognize the expenditure in the year employees earned the benefit --
underpayment is not liability of fund but a noncurrent liability.
Defined Benefit Plan - correct answer ✔✔Government obligation is to pay certain
amount to retirees each period. Annual required contribution (ARC) based on
many actuarial assumptions.
Consumption Method for Inventory - correct answer ✔✔Supplies represent an
expendable current financial resource - it can be used to finance future
"expenditures" for supplies.
Purchases Method for Inventory - correct answer ✔✔Already charged to
expenditures, so it does not represent a current financial resource.
Consumption Method for Prepayments - correct answer ✔✔The prepayments
account balance is reported as an asset.
Purchases Method for Prepayments - correct answer ✔✔The prepayments
account balance is not reported as an asset, since the amount has already been
charged to expenditures.
Fund - correct answer ✔✔Basic classification of these are by this, but it does have
other options.
Capital Leases - correct answer ✔✔Assets under this are recorded in General
Capital Assets with corresponding entry in General Long-Term Liabilities.
correctly answered graded A+ already
passed
Expenditures - correct answer ✔✔Are the foundation of planning, authorizing,
controlling, and evaluating activities of governmental funds. It's a measure of the
fund liabilities incurred (or expendable financial resources used). Typically
classified as operations, capital outlay, or debt service.
When to Recognize Expenditures - correct answer ✔✔In the accounting period in
which the fund liability is incurred except for unmatured interest (and principal)
on long-term debt, which is recognized when due.
Inventory Expenditures - correct answer ✔✔May be recognized using either
purchases method or consumption method.
Prepayment Expenditures - correct answer ✔✔May be allocated over benefited
period or accounted for only in current period.
Pension Cost Expenditures - correct answer ✔✔Payments to pension plans, even
self-administered ones, qualify as expenditures; most govt's either use defined
contribution or defined benefit contribution.
Defined Contribution Plan - correct answer ✔✔Government obligation is limited
to making contributions required by the plan; retiree benefits dependent upon
contributions made and the investment performance of the plan. Government
, should recognize the expenditure in the year employees earned the benefit --
underpayment is not liability of fund but a noncurrent liability.
Defined Benefit Plan - correct answer ✔✔Government obligation is to pay certain
amount to retirees each period. Annual required contribution (ARC) based on
many actuarial assumptions.
Consumption Method for Inventory - correct answer ✔✔Supplies represent an
expendable current financial resource - it can be used to finance future
"expenditures" for supplies.
Purchases Method for Inventory - correct answer ✔✔Already charged to
expenditures, so it does not represent a current financial resource.
Consumption Method for Prepayments - correct answer ✔✔The prepayments
account balance is reported as an asset.
Purchases Method for Prepayments - correct answer ✔✔The prepayments
account balance is not reported as an asset, since the amount has already been
charged to expenditures.
Fund - correct answer ✔✔Basic classification of these are by this, but it does have
other options.
Capital Leases - correct answer ✔✔Assets under this are recorded in General
Capital Assets with corresponding entry in General Long-Term Liabilities.
