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CGFM EXAM 2 Study Questions and
Correct Answers/ Latest Update / Already
Graded
Non-Spendable Fund Balance
Ans: Assets not in spendable form-Inventories and prepaid
items, principal of a permanent fund which may not be spent,
and assets held for sale and long-term receivables. Examples:
Supplies, inventory, membership fees
Restricted Fund Balance
Ans: Subject to constraints imposed by external parties or law.
Debt covenants (such as a requirement for a sinking fund) or
constraints imposed by legislation or federal and state
agencies, creditors, contributors or granting agencies
Three Categories of net position section of the government-wide
Statement of Net Position
Ans: Restricted, Committed & Assigned
Committed Fund Balance
Ans: Governing body formally committed net resources to
specific activities. Contractual obligations outstanding. Board
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approval of large construction contracts would typically
represent commitment of the funds.
Assigned Fund Balance
Ans: Residual balances in funds other than the General Fund or
in the general fund that are intended for identified purposes
Difference between Committed and Restricted
Ans: Committed constraint is imposed by a government upon
itself
GASB standards state that rainy day funds may be classified as
committed only under specific circumstances which are
Ans: they are created by a resolution or ordinance that
identifies the specific circumstances under which the resources
may be expended
Other financing sources consist of
Ans: transfers in from other funds and proceeds of long -term
borrowing
Fund Revenues consist of
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Ans: taxes, charges for services, amounts provided by other
entities such as state or federal government
Other fund uses
Ans: Transfers of cash out of one fund to other funds
To recognize revenue from the General Fund transferred to a debt
service fund to record payments of interest and principal on general
obligation debt
Ans: Credit General Fund Tax Revenue
Debit General Fund Other Financing Uses-Transfers Out
Debit Debt Service Fund Other Financing Sources - Transfer In
Credit Debt Service Fund Expenditures
Fund Budgetary Accounts
Ans: Estimated Revenues, Appropriations, Estimated Other
Financing Sources, Estimated Other Financing Uses,
Encumbrances
Fund Activity Accounts
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Ans: Revenues, Expenditures, Other Financing Sources, Other
Financing Uses
Fund Revenues
Ans: Tax Revenues, Charges for Services
Fund Expenditures
Ans: Current, Capital Outlay, Debt Service
Other Financing Sources
Ans: Transfers In, Debt Proceeds
Other Financing Uses
Ans: Transfers Out
When a PO or Contract is issued as authorized by an appropriation the
government recognizes this commitment as
Ans: An encumbrance (not yet a liability)
JE for City Council approves fiscal year budget for General Fund
All rights reserved © 2025/ 2026 |
CGFM EXAM 2 Study Questions and
Correct Answers/ Latest Update / Already
Graded
Non-Spendable Fund Balance
Ans: Assets not in spendable form-Inventories and prepaid
items, principal of a permanent fund which may not be spent,
and assets held for sale and long-term receivables. Examples:
Supplies, inventory, membership fees
Restricted Fund Balance
Ans: Subject to constraints imposed by external parties or law.
Debt covenants (such as a requirement for a sinking fund) or
constraints imposed by legislation or federal and state
agencies, creditors, contributors or granting agencies
Three Categories of net position section of the government-wide
Statement of Net Position
Ans: Restricted, Committed & Assigned
Committed Fund Balance
Ans: Governing body formally committed net resources to
specific activities. Contractual obligations outstanding. Board
All rights reserved © 2025/ 2026 |
, Page |2
approval of large construction contracts would typically
represent commitment of the funds.
Assigned Fund Balance
Ans: Residual balances in funds other than the General Fund or
in the general fund that are intended for identified purposes
Difference between Committed and Restricted
Ans: Committed constraint is imposed by a government upon
itself
GASB standards state that rainy day funds may be classified as
committed only under specific circumstances which are
Ans: they are created by a resolution or ordinance that
identifies the specific circumstances under which the resources
may be expended
Other financing sources consist of
Ans: transfers in from other funds and proceeds of long -term
borrowing
Fund Revenues consist of
All rights reserved © 2025/ 2026 |
, Page |3
Ans: taxes, charges for services, amounts provided by other
entities such as state or federal government
Other fund uses
Ans: Transfers of cash out of one fund to other funds
To recognize revenue from the General Fund transferred to a debt
service fund to record payments of interest and principal on general
obligation debt
Ans: Credit General Fund Tax Revenue
Debit General Fund Other Financing Uses-Transfers Out
Debit Debt Service Fund Other Financing Sources - Transfer In
Credit Debt Service Fund Expenditures
Fund Budgetary Accounts
Ans: Estimated Revenues, Appropriations, Estimated Other
Financing Sources, Estimated Other Financing Uses,
Encumbrances
Fund Activity Accounts
All rights reserved © 2025/ 2026 |
, Page |4
Ans: Revenues, Expenditures, Other Financing Sources, Other
Financing Uses
Fund Revenues
Ans: Tax Revenues, Charges for Services
Fund Expenditures
Ans: Current, Capital Outlay, Debt Service
Other Financing Sources
Ans: Transfers In, Debt Proceeds
Other Financing Uses
Ans: Transfers Out
When a PO or Contract is issued as authorized by an appropriation the
government recognizes this commitment as
Ans: An encumbrance (not yet a liability)
JE for City Council approves fiscal year budget for General Fund
All rights reserved © 2025/ 2026 |
