ACE Airport Financial Management 4

Question 1

Which accounting standard requires most US public airports to follow governmental or enterprise fund accounting?

Accepted Answer

GASB standards

Answer

The Governmental Accounting Standards Board (GASB) sets the accounting rules for public-sector entities, including most US airports.

Question 2

What is the purpose of an airport's Capital Improvement Program (CIP)?

Accepted Answer

To plan and prioritize multi-year infrastructure investments

Answer

A CIP is a multi-year schedule identifying planned capital projects, their costs, timing, and funding sources.

Question 3

Airport landing fees are most commonly calculated based on which aircraft characteristic?

Accepted Answer

Maximum certificated gross landing weight

Answer

Landing fees are typically assessed per 1,000 lbs of maximum certificated gross landing weight (MGLW) to reflect pavement impact.

Question 4

When airports apply for AIP discretionary grants, which federal agency reviews and approves those applications?

Accepted Answer

FAA

Answer

The FAA administers the AIP and reviews applications to determine eligibility and approve discretionary grant awards.

Question 5

A 'coverage covenant' in an airport revenue bond indenture typically requires the airport to maintain a debt service coverage ratio of at least:

Accepted Answer

1.25x

Answer

A 1.25x coverage covenant is the most common minimum threshold in US airport revenue bond indentures.

(ACE) Airport Certified Employee Practice Test