Accounting Online Program Governmental and Nonprofit Accounting 1

Question 1

Which standard-setting body establishes GAAP for state and local governments in the United States?

Accepted Answer

GASB

Answer

The Governmental Accounting Standards Board (GASB) establishes generally accepted accounting principles for state and local governments.

Question 2

Which fund type is the primary operating fund used to account for most general government activities?

Accepted Answer

General Fund

Answer

The General Fund is the chief operating fund of a government, accounting for all financial resources not required to be accounted for in another fund.

Question 3

What basis of accounting is used for governmental funds under GASB standards?

Accepted Answer

Modified accrual basis

Answer

Governmental funds use the modified accrual basis, recognizing revenues when measurable and available, and expenditures when the liability is incurred.

Question 4

Under modified accrual accounting, revenues are recognized when they are:

Accepted Answer

Measurable and available

Answer

Modified accrual recognizes revenues when they are both measurable and available, meaning collectible within 60 days after year-end.

Question 5

What does ACFR stand for in the context of government financial reporting?

Accepted Answer

Annual Comprehensive Financial Report

Answer

The Annual Comprehensive Financial Report (ACFR), formerly called CAFR, is the complete set of audited financial statements issued by state and local governments.

Accounting Online Program Practice Test

Accounting Online Program Practice Test

Accounting Online Program Governmental and Nonprofit Accounting 1