CGFM Governmental Accounting and Fund Accounting 2

Question 1

Which GASB statement established the current framework for fund accounting in state and local governments?

Accepted Answer

GASB Statement No. 34

Answer

GASB Statement No. 27

Answer

GASB Statement No. 45

Answer

GASB Statement No. 54

Question 2

A Debt Service Fund is used to account for:

Accepted Answer

Accumulation of resources for payment of long-term debt principal and interest

Answer

Proceeds from long-term debt issuance

Answer

Capital asset acquisitions financed through debt

Answer

Interfund loans between governmental funds

Question 3

Which of the following is NOT a governmental fund type under GASB?

Accepted Answer

Internal Service Fund

Answer

Special Revenue Fund

Answer

Capital Projects Fund

Answer

Permanent Fund

Question 4

Encumbrances in governmental accounting represent:

Accepted Answer

Commitments related to unperformed contracts for goods or services

Answer

Expenditures already paid

Answer

Long-term liabilities for capital leases

Answer

Accrued payroll not yet paid

Question 5

In fund accounting, which of the following best describes a Special Revenue Fund?

Accepted Answer

Accounts for revenues legally restricted to expenditure for specific purposes

Answer

Accounts for the government's primary operating activities

Answer

Accounts for resources set aside for capital asset acquisition

Answer

Accounts for payments of long-term debt obligations

Question 6

Interfund transfers differ from interfund loans because transfers:

Accepted Answer

Are not required to be repaid

Answer

Must be repaid with interest

Answer

Require legislative appropriation

Answer

Are only allowed between proprietary funds

Question 7

Under GASB, Permanent Funds are used to account for resources that are legally restricted so that:

Accepted Answer

Only earnings, not principal, may be used to support government programs

Answer

Both principal and earnings support capital projects

Answer

Principal may be spent only for debt service

Answer

Resources are held in trust for external parties