, Chapter 01
Introduction to Accounting and Financial Reporting for
Governmental and Not-for-Profit Entities
True / False Questions
1
. Special purpose governments generally provide a wider range of services to their residents than do general pu
True False
2
. Examples of general purpose governments include cities, towns, and public schools that receive tax revenue t
they provide.
True False
3
. The Governmental Accounting Standards Board (GASB) is the body authorized to establish accounting princ
local governments, both general purpose and special purpose.
True False
4
. The Governmental Accounting Standards Board (GASB) is the body authorized to establish accounting principl
entities.
True False
1-1
Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.
,5
. The Financial Accounting Standards Board (FASB) is the body authorized to establish accounting principle
universities and health care entities.
True False
6
. Neither governmental nor not-for-profit entities have residual equity that can be distributed to owners.
True False
7
. A characteristic common to governmental and not-for-profit organizations is that they do not exist to provide g
profit or profit equivalent.
True False
8
. The needs of users of government financial reports are the same as those of users of business entity financial
True False
9
. The Federal Accounting Standards Advisory Board (FASAB) recommends accounting principles and stand
government and its agencies and departments.
True False
1
0. The FASB, GASB, and FASAB all focus their standards on both internal and external financial reporting.
True False
1-2
Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.
, 1
1. Interperiod equity refers to the concept that current-year revenues are sufficient to pay for services provi
future taxpayers will not be required to assume the burden for services previously provided.
True False
1
2. The minimum requirements for general purpose external financial reporting are (1) management's discussion
(2) the basic financial statements, including the notes to the financial statements, and (3) combining and in
statements.
True False
1
3. The Financial Accounting Foundation has oversight over both FASB and GASB.
True False
1
4. In addition to financial statements and notes, GASB requires governments to provide information o
accomplishments (SEA) in their reports to the public.
True False
1
5. Providing information on accountability is the primary financial reporting objective for both governmental and
True False
1
6. A difference in the financial reporting objectives for governmental entities and not-for-profit entities is that
report on compliance with laws, regulations, and rules that impact financial reports.
True False
1-3
Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.
Introduction to Accounting and Financial Reporting for
Governmental and Not-for-Profit Entities
True / False Questions
1
. Special purpose governments generally provide a wider range of services to their residents than do general pu
True False
2
. Examples of general purpose governments include cities, towns, and public schools that receive tax revenue t
they provide.
True False
3
. The Governmental Accounting Standards Board (GASB) is the body authorized to establish accounting princ
local governments, both general purpose and special purpose.
True False
4
. The Governmental Accounting Standards Board (GASB) is the body authorized to establish accounting principl
entities.
True False
1-1
Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.
,5
. The Financial Accounting Standards Board (FASB) is the body authorized to establish accounting principle
universities and health care entities.
True False
6
. Neither governmental nor not-for-profit entities have residual equity that can be distributed to owners.
True False
7
. A characteristic common to governmental and not-for-profit organizations is that they do not exist to provide g
profit or profit equivalent.
True False
8
. The needs of users of government financial reports are the same as those of users of business entity financial
True False
9
. The Federal Accounting Standards Advisory Board (FASAB) recommends accounting principles and stand
government and its agencies and departments.
True False
1
0. The FASB, GASB, and FASAB all focus their standards on both internal and external financial reporting.
True False
1-2
Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.
, 1
1. Interperiod equity refers to the concept that current-year revenues are sufficient to pay for services provi
future taxpayers will not be required to assume the burden for services previously provided.
True False
1
2. The minimum requirements for general purpose external financial reporting are (1) management's discussion
(2) the basic financial statements, including the notes to the financial statements, and (3) combining and in
statements.
True False
1
3. The Financial Accounting Foundation has oversight over both FASB and GASB.
True False
1
4. In addition to financial statements and notes, GASB requires governments to provide information o
accomplishments (SEA) in their reports to the public.
True False
1
5. Providing information on accountability is the primary financial reporting objective for both governmental and
True False
1
6. A difference in the financial reporting objectives for governmental entities and not-for-profit entities is that
report on compliance with laws, regulations, and rules that impact financial reports.
True False
1-3
Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.
