Question

1. The City of Fox is evaluating which of its funds it will present as a major fund in its fund financial statements at December 31, Year 1. The city presents the following partial listing of asset data at December 31, Year 1:

Total Governmental Fund Type Assets	$ 3,000,000
Total Enterprise Fund Assets	2,000,000
General Fund Assets	280,000
Community Development Special Revenue Fund	290,000
Sales Tax Special Revenue Fund	350,000
General Revenue Bonds Debt Service Fund	120,000
Faberville River Bridge Capital Project Fund	1,500,000
Faberville Water & Sewer Utility Fund	1,800,000
Faberville Landfill	200,000

Based purely on assets, how many funds should be displayed as major funds?

	a.	Four.
	b.	Five.
	c.	Six.
	d.	Three.

Answer 1

Answer) A) Four

Option A is correct. Four funds would be treated as major funds. Three of the funds meet the specific criteria for major fund treatment and the General Fund, even though it does not meet the criteria, is always treated as a major fund since, as the general operating fund of the government, to exclude that fund would reduce the usefulness of the fund financial statements.