CDFM Accounting and Financial Reporting 2

Question 1

Under DoD accounting standards, which financial statement presents the net cost of operations for a federal agency?

Accepted Answer

Statement of Net Cost

Answer

The Statement of Net Cost shows the net cost of operations by responsibility segment, reflecting gross costs less earned revenues.

Question 2

What is the primary purpose of the Statement of Budgetary Resources (SBR) in federal financial reporting?

Accepted Answer

Report on budgetary authority and its status

Answer

The SBR provides information on budgetary resources made available and their status, linking budget execution to financial reporting.

Question 3

In federal accounting, 'intragovernmental' transactions refer to transactions between:

Accepted Answer

Two federal entities within the same reporting entity

Answer

Intragovernmental transactions occur between federal entities and must be eliminated in consolidated financial statements to avoid double-counting.

Question 4

Which accounting basis is required for federal agency financial statements under SFFAS No. 1?

Accepted Answer

Full accrual basis

Answer

SFFAS No. 1 requires full accrual accounting for federal financial statements, recognizing revenues when earned and expenses when incurred.

Question 5

A DoD component receives a reimbursable order from another federal agency. When should revenue be recognized?

Accepted Answer

When goods are delivered or services are performed

Answer

Under accrual accounting, reimbursable revenue is recognized when the earning event occurs — delivery of goods or performance of services.

CDFM - Certified Defense Financial Manager Practice Test