GOVERNMENT FINAL EXAM PRACTICE QUESTIONS AND CORRECT ANSWERS

GOVERNMENT FINAL EXAM
PRACTICE QUESTIONS AND
CORRECT ANSWERS
FASABA2requiresA2nonexchangeA2revenuesA2toA2reportedA2onA2bothA2theA2accrualA2andA2
theA2cashA2basisA2ofA2accounting.A2-A2Ans--True

AllA2not-for-profitA2organizations,A2includingA2city-ownedA2museumsA2andA2two-
yearA2communityA2colleges,A2mustA2adhereA2toA2FASBA2accountingA2andA2financialA2repo
rtingA2standards.A2-A2Ans--False

MedicaidA2isA2aA2federallyA2sponsoredA2andA2managedA2healthA2careA2programA2forA2retir
ees.A2-A2Ans--False

TheA2AICPAA2hasA2grantedA2theA2FASABA2exclusiveA2authorityA2toA2establishedA2GAAPA2
forA2federalA2entities.A2-A2Ans--True

NewlyA2installedA2computerA2programsA2areA2oneA2indicatorA2thatA2aA2government'sA2parti
cipationA2inA2aA2federalA2programA2mayA2beA2atA2highA2riskA2ofA2noncompliance.A2-A2Ans--
True

FederalA2operationsA2areA2accountedA2forA2inA2fourA2typesA2ofA2funds.A2WhichA2ofA2theA2fo
llowingA2isA2oneA2ofA2theA2typesA2ofA2fundsA2used?A2-A2Ans--RevolvingA2funds

TheA2U.S.A2PostalA2ServiceA2isA2accountedA2forA2inA2whichA2ofA2theA2followingA2fundA2type
s?A2-A2Ans--RevolvingA2fund

InA2YearA21,A2theA2ExpertA2GardenersA2GroupA2receivesA2aA2$60,000A2grantA2toA2promote
A2itsA2"Grow-Ur-
Own"A2greenA2vegetablesA2programA2amongA2DesertA2CityA2residents.A2InA2YearA22,A2theA
2groupA2spendsA2theA2grantA2fundsA2forA2theA2stipulatedA2purpose.A2-A2Ans--
DebitA2Cash;A2CreditA2RevenueA2fromA2contributionsA2(restrictedA2fund)

WhichA2ofA2theA2followingA2isA2aA2trueA2statementA2aboutA2theA2FederalA2AccountingA2Sta
ndardsA2AdvisoryA2Board?A2-A2Ans--
ItA2isA2aA2sharedA2jurisdictionA2boardA2createdA2followingA2anA2agreementA2byA2threeA2fed
eralA2agencies

HospitalA2revenueA2usuallyA2includesA2whichA2ofA2theA2following?
EducationalA2Program--NonrestrictedA2GiftsA2-A2Ans---A2Yes,A2No

FinancialA2auditsA2generallyA2areA2conductedA2annually.A2PerformanceA2auditsA2generally
A2areA2conductedA2-A2Ans--OnA2anA2irregularA2basis

, WhichA2ofA2theA2followingA2groupsA2isA2responsibleA2forA2administeringA2theA2SingleA2Audi
tA2Act?A2-A2Ans--OMB

WhichA2ofA2theA2followingA2isA2NOTA2trueA2ofA2anA2attestationA2engagement?A2-A2Ans--
ItA2shouldA2notA2beA2performedA2ifA2theA2reliabilityA2ofA2theA2entity'sA2performanceA2measu
resA2isA2questionable.

WhichA2ofA2theA2followingA2isA2aA2uniqueA2characteristicA2ofA2theA2federalA2governmentA2t
hatA2necessitatesA2specialA2accountingA2andA2reportingA2practices?A2-A2Ans---
A2TheA2extentA2ofA2itsA2powers


St.A2Mary'sA2ExtendedA2CareA2Center,A2aA2not-for-
profitA2entity,A2enjoysA2theA2servicesA2ofA2aA2groupA2ofA2high-school-
ageA2peopleA2whoA2eachA2agreeA2toA2workA2threeA2afternoonsA2aA2weekA2forA2threeA2hour
sA2eachA2afternoonA2performingA2aA2varietyA2ofA2patient-
relatedA2services,A2suchA2asA2writingA2lettersA2forA2thoseA2whoA2areA2unableA2toA2doA2so,A2
deliveringA2mailA2toA2theA2patientA2rooms,A2andA2pushingA2wheel-
chairA2patientsA2acrossA2theA2grounds.A2TheA2servicesA2renderedA2byA2theseA2youngA2pe
opleA2enhanceA2theA2qualityA2ofA2lifeA2forA2theA2residents.A2TheyA2couldA2notA2beA2provide
dA2ifA2theyA2wereA2notA2donatedA2becauseA2thereA2areA2notA2enoughA2resourcesA2toA2doA2
so.A2TheA2pastA2yearA2theA2youngA2peopleA2donatedA25,000A2hoursA2inA2total.A2TheA2servi
cesA2wouldA2haveA2costA2$6.00A2perA2hourA2ifA2theyA2hadA2beenA2purchasedA2butA2theyA2
wereA2worthA2$10A2anA2hourA2toA2St.A2Mary's.A2WhatA2isA2theA2amountA2ofA2contributedA2r
evenueA2thatA2shouldA2beA2recognizedA2byA2St.A2Mary'sA2relatedA2toA2theseA2services?A2-
A2Ans---A2$0


WhichA2ofA2theA2followingA2entitiesA2shouldA2recognizeA2depreciationA2expenseA2onA2itsA2
operatingA2statement?
-A2Not-for-profitA2university.
-A2Not-for-profitA2foundation.
-A2Not-for-profitA2hospital.
-A2AllA2ofA2theA2above.A2-A2Ans---A2AllA2ofA2theA2above

UnitedA2Charities'A2annualA2fund-
raisingA2driveA2inA22016A2raisedA2pledgesA2ofA2$1,200,000A2ofA2whichA2$800,000A2wereA2c
ollectedA2inA22016A2andA2$200,000A2wereA2collectedA2inA22017.A2UnitedA2CharitiesA2estim
atesA2$150,000A2ofA2theA2remainingA2pledgesA2willA2neverA2beA2collected.
InA2theA2currentA2yearA2NationalA2PetA2Charities,A2whichA2usesA2fund-
typeA2accountingA2toA2maintainA2itsA2booksA2andA2records,A2receivedA2aA2$30,000A2contri
butionA2toA2helpA2educateA2peopleA2onA2responsibleA2petA2ownership.A2DuringA2theA2curre
ntA2year,A2theA2entryA2toA2recordA2thisA2donationA2isA2-A2Ans--
UNRESTRICTEDA2FUND.A2NoA2entry.A2RESTRICTEDA2FUND.A2DebitA2CashA2$30,000;A
2CreditA2NetA2assetsA2$30,000