Test bank advanced accounting 10e by beams chapter 18

To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com Chapter 18 Test Bank AN INTRODUCTION TO ACCOUNTING FOR STATE AND LOCAL GOVERNMENTAL UNITS Multiple Choice Questions LO1 Before the establishment of the Governmental Standards Board, which organization developed governments? a b c d LO1 Financial Accounting Standards Board statements GASB statements EITF Accountants must exercise judgment because there was no structured organization for governmental GAAP The key focus of government fund accounting concerns a b c d LO2 The Financial Accounting Standards Board The Financial Accounting Foundation The National Council on Governmental Accounting There was no structured organization for governmental GAAP before the GASB What GAAP pronouncements take precedence for an auditor under SAS 69? a b c d LO2 Accounting GAAP for capital expenditures intergovernmental transfers from the general fund income measurement the flow of current financial resources When vehicles impounded by the city police are sold, the cash goes into which fund? a b c d The The The The general fund debt service fund fiduciary fund proprietary fund ©2009 Pearson Education, Inc publishing as Prentice Hall 18-1 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com LO2 Budgeted authority for expenditures that provide legislative control over expenditures are referred to as a b c d LO2 appropriations allotments allocations encumbrances Because a fund is an accounting entity, each fund has I its own accounting equation II its own journals, ledgers, and other accounting records III its own separate auditor a b c d LO3 I only II only I and II I, II and III One of the required proprietary fund financial statements is a a statement of b statement of earnings c statement of d statement of balance LO3 activity changes revenues, expenditures, and changes in fund Under the modified accrual basis of accounting, revenues are recognized in the period a b c d LO4 cash flows revenues, expenses, and changes in retained when when when when the relevant service is done they are collected the enterprise customer is billed become both measurable and available Under GASB 33, which of the following is an exchange transaction? a When the home owner pays property taxes b When a university receives a federal grant for managing research c When an aquatic center receives cash for a group swim d When an employer deducts money for state tax withholding ©2009 Pearson Education, Inc publishing as Prentice Hall 18-2 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com LO4 10 Which fund would most likely report depreciation expense? a b c d LO4 11 Which type of fund is used to account for a government activity that sells goods or services either solely or almost solely to external customers? a b c d LO4 12 A temporary fund A general fund An agency fund An enterprise fund Centralized data processing, central motor pools and garages, centralized risk-financing activities, and central stores typically would be accounted for using what type of fund? a b c d LO4 13 An intergovernmental service fund An enterprise fund A capital projects fund A debt service fund An agency fund An enterprise fund An internal service fund A trust fund The modified accrual basis of accounting is used for a b c d LO4 14 governmental funds proprietary funds internal service funds both a and c Goodtime City makes a levy on its seafront businesses for a retaining wall Which of the following funds will have transactions? a b c d A A A A general capital special capital fund projects and general fund revenue fund projects and special revenue fund ©2009 Pearson Education, Inc publishing as Prentice Hall 18-3 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com LO5 15 Motor fuel taxes are a b c d LO5 16 A budget in government accounting a b c d LO5 17 derived tax revenues imposed non exchange revenues government-mandated nonexchange transactions voluntary nonexchange transactions only applies to the general fund is a guideline for government management has the force of law only applies to proprietary funds A component unit a requires discrete CAFR presentation of the primary government b does not appear in CAFR unless it is a proprietary fund of a primary government c activities are held responsible to a primary government d activities will be financially accountable to a primary government even though it is a legally separate organization LO6 18 Government-wide financial statements include a a balance sheet, an income statement, and flows b statement of net assets, a statement of statement of cash flows c statement of net assets and a statement d statement of activities and a statement LO6 19 a statement of cash activities, and a of activities of cash flows A comprehensive annual financial report has the following three major sections a introductory, financial, and management's discussion and analysis b introductory, financial, and statistical c transmittal, financial, and statistical d transmittal, financial, and management's discussion and analysis ©2009 Pearson Education, Inc publishing as Prentice Hall 18-4 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com LO6 20 Government-wide financial statements exclude the a b c d general fund fiduciary funds proprietary funds special revenue funds ©2009 Pearson Education, Inc publishing as Prentice Hall 18-5 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com LO3 Exercise The following are transactions for the city of Novo a b c d of e Borrowed $10,000 by issuing a three-month note Paid $2,000 for equipment Services for $250 were billed and collected Issued general obligation bonds, par value of $5,000, at 101 (101% par value) to finance construction of a building Incurred and paid construction costs of $2,500 on the building Required: Analyze the above transactions by using the accounting equation for a governmental fund LO3 Exercise The following are transactions for the city of Novo a b c d of e Borrowed $10,000 by issuing a three-month note Paid $2,000 for equipment Services for $250 were billed and collected Issued general obligation bonds, par value of $5,000, at 101 (101% par value) to finance construction of a building Incurred and paid construction costs of $2,500 on the building Required: Analyze the above transactions by using the accounting equation for a proprietary fund ©2009 Pearson Education, Inc publishing as Prentice Hall 18-6 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com LO3 Exercise The following are transactions for the city of Oz a Borrowed $10,000 by issuing a two-year note b Issued a purchase order to a vendor for equipment worth $3,000 c Licenses for $350 were billed on account d Received a $5,000 capital grant from another governmental fund e Accrued employee salary costs of $3,500 Required: Analyze the above transactions by using the accounting equation for a governmental fund LO3 Exercise The following are transactions for the city of Oz a Borrowed $10,000 by issuing a two-year note b Issued a purchase order to a vendor for equipment worth $3,000 c Licenses for $350 were billed on account d Received a $5,000 capital grant from another governmental fund e Accrued employee salary costs of $3,500 Required: Analyze the above transactions by using the accounting equation for a proprietary fund ©2009 Pearson Education, Inc publishing as Prentice Hall 18-7 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com LO4 Exercise For each of the following funds and entities: Internal Service Fund Investment Trust Fund Debt Service Fund Special Revenue Fund Required: Identify the financial statements and/or schedules required to be presented State the required basis of accounting LO4 Exercise For each of the following funds and entities: Capital Projects Fund Pension Trust Fund Permanent Fund Proprietary Fund Required: Identify the financial statements and/or schedules required to be presented State the required basis of accounting LO4 Exercise For each of the following events or transactions, identify the fund or funds that will be affected A city government provides electricity services to residents for a fee A printing shop was established to handle the printing needs of a county government A philanthropist donates $1 million for a memorial A state government collects sales taxes on behalf of the state and for some of its counties and municipalities Interest is paid on a state government's general obligation bonds ©2009 Pearson Education, Inc publishing as Prentice Hall 18-8 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com LO4 Exercise For each of the following events or transactions, identify the fund or funds that will be affected A city government charges a fee for the use of the municipal golf course Interest is paid on state government revenue bonds A motor pool was established to handle the vehicle needs of a county government A county government receives a large contribution specifying that income from the contribution be distributed each year to three city libraries within the county The principal is to remain intact indefinitely A state government acquires the use of general fixed assets by entering into a capital lease contract LO4 Exercise For each of the following events or transactions, identify the fund or funds that will be affected A central purchasing department was established to handle all the purchasing needs of a county government A county government levies real property taxes on behalf of the county and its municipalities A county government receives a large contribution specifying that income from the contribution be distributed each year to the county zoo The principal is to remain intact indefinitely A county government establishes an investment pool to manage the cash and marketable securities of the county and participating municipalities A city government pays the final contract retained percentage for a new fire station ©2009 Pearson Education, Inc publishing as Prentice Hall 18-9 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com LO6 Exercise 10 List the financial statements and/or schedules required to be presented for each of the following funds and entities as well as the required basis of accounting Agency Fund General Fund Private-purpose Trust Fund Government-wide Financial Statements ©2009 Pearson Education, Inc publishing as Prentice Hall 18-10 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com SOLUTIONS Multiple Choice Questions c b d a a c a d c 10 b 11 d 12 c 13 a 14 d 15 a 16 c 17 d 18 c 19 b 20 b ©2009 Pearson Education, Inc publishing as Prentice Hall 18-11 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com Exercise Governmental fund equation Current assets Current liabilities Fund balance a +10,000 b -2,000 c +250 d +5,050 e -2,500 -2,000 +250 +5,050 -2,500 b -2,000 +2,000 c +250 d +5,050 e -2,500 +2,500 +10,000 Exercise Proprietary fund equation Current assets Noncurrent assets Current liabilities Noncurrent liabilities Net Assets a +10,000 +10,000 +5,050 +250 Exercise Governmental fund equation Current assets Current liabilities Fund balance a +10,000 b 0 +10,000 c +350 d +5,000 e +3,500 +350 +5,000 c +350 d +5,000 -3,500 Exercise Proprietary fund equation Current assets Noncurrent assets Current liabilities Noncurrent liabilities Net assets a +10,000 +10,000 b 0 0 e +3500 +350 +5,000 ©2009 Pearson Education, Inc publishing as Prentice Hall 18-12 -3,500 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com Exercise Balance Sheet and Statement of Revenues, Expenditures, and Changes in Fund Balances All statements are prepared on the modified accrual basis Balance Sheet and Statement of Revenues, Expenditures, and Changes in Fund Balances All statements are prepared on the modified accrual basis Statement of Fiduciary (Plan) Net Assets and Statement of Changes in Fiduciary (Plan) Net Assets All statements are prepared on the accrual basis Statement of Net Assets, Statement of Revenues, Expenses, and Changes in Net Assets and a Statement of Cash Flows (direct method only) All statements are prepared on the accrual basis Exercise Balance Sheet and Statement of Revenues, Expenditures, and Changes in Fund Balances All statements are prepared on the modified accrual basis Balance Sheet and Statement of Revenues, Expenditures, and Changes in Fund Balances All statements are prepared on the modified accrual basis Statement of Fiduciary (Investment) Net Assets and Statement of Changes in Fiduciary (Investment) Net Assets All statements are prepared on the accrual basis Statement of Net Assets, Statement of Revenues, Expenses, and Changes in Net Assets and a Statement of Cash Flows (direct method only) All statements are prepared on the accrual basis Exercise Enterprise Fund Internal Service Fund Permanent Fund General Fund and Agency Fund Debt Service Fund Exercise Enterprise Fund Debt Service Fund Internal Service Fund Fiduciary (Private-purpose) Trust Fund General Fund ©2009 Pearson Education, Inc publishing as Prentice Hall 18-13 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com Exercise Internal Service Fund General Fund and Agency Fund Permanent Fund Fiduciary (Investment) Trust Fund Capital Projects Fund Exercise 10 Statement of Fiduciary Net Assets and Statement of Changes in Fiduciary Net Assets All statements are prepared on the accrual basis Balance Sheet, Statement of Revenues, Expenditures, and Changes in Fund Balances and a Budgetary Comparison Schedule All statements are prepared on the modified accrual basis Statement of Fiduciary Net Assets and Statement of Changes in Fiduciary Net Assets All statements are prepared on the accrual basis Statement of Net Assets and Statement of Activities All statements are prepared on the accrual basis ©2009 Pearson Education, Inc publishing as Prentice Hall 18-14 ... transactions by using the accounting equation for a proprietary fund ©2009 Pearson Education, Inc publishing as Prentice Hall 18- 6 To download more slides, ebook, solutions and test bank, visit... transactions by using the accounting equation for a proprietary fund ©2009 Pearson Education, Inc publishing as Prentice Hall 18- 7 To download more slides, ebook, solutions and test bank, visit... Prentice Hall 18- 3 To download more slides, ebook, solutions and test bank, visit http://downloadslide.blogspot.com LO5 15 Motor fuel taxes are a b c d LO5 16 A budget in government accounting a