Question

4) A properly prepared schedule of revenues, expenditures, and changes in fund halar budget and actual will include which of the following columns? A) Actual revenue and expenditure amounts on the GAAP basis. B) Actual revenue and expenditure amounts on the budget basis. C) Encumbrances outstanding at year-end. D) Unexpended appropriations. 5) Which of the following would properly be reported in the operating statement of a governmental fund? A) Interest on a tax anticipation note issued and repaid during the period. B) Amortization expense. C) Depreciation expense. D) A grant that is intended to finance activities of the following period. 6) The Estimated Revenues account of a government is debited when: A) The budget is recorded at the beginning of the year. B) Property taxes are recorded. C) The account is closed to fund balance unassigned at the end of the year. D) Property taxes are collected. 7) Capital assets used by governmental funds should be reported in: A) The appropriate governmental funds. B) The property, plant, and equipment fund. C) Departmental memorandum records. D) The governmental activities column of the government-wide statements. 8) GASB standards require that general capital assets be recorded in the fund statements at: A) Historical cost. B) Fair value at the financial statement date. C) Estimated cost at the financial statement date. D) None of the options are correct. 9) The following items were included in Castle City's General Fund expenditures for the year ended June. Personal computer for the city treasurer 6,000 Furniture for the mayor's office $ 20,000 How much should be classified as capital assets in Castle City's General Fund balance sheet at June 302 A) SO. B) $6,000. C) $20,000 D) $26,000

Answer 1

4) Correct option is (B). Actual revenue and expenditure amounts on the budgeted basis. Budgeted columns are added to the schedule of revenue, expenditure and changes in fund balances for better understanding.

5) Option (A). Interest on tax anticipation note issued and repaid during the year.

6) Option (C) -: this entry is passed at the time of closing of the account of fund balance.

7) Option (D) -: The capital assets which are used are not financial resources and hence not recorded in the funds of the government.

8) Option (D) -: GASB standards suggests the use of accrual basis of accounting.

9) Option (A) -: As said above capital assets are not recorded under government activities.