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. 34 established the basic financial reporting model including government-wide and fund financial statements used today.

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

Debt Service Funds accumulate financial resources for payment of principal and interest on general long-term debt.

Question 3

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

Accepted Answer

Internal Service Fund

Answer

Internal Service Funds are proprietary funds, not governmental funds; the five governmental fund types are General, Special Revenue, Capital Projects, Debt Service, and Permanent.

Question 4

Encumbrances in governmental accounting represent:

Accepted Answer

Commitments related to unperformed contracts for goods or services

Answer

Encumbrances represent commitments (purchase orders, contracts) for which goods or services have not yet been received, reserving the appropriation balance.

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

Special Revenue Funds account for revenues that are legally restricted or committed to be used for specific purposes other than debt service or capital projects.

CGFM - Certified Government Financial Manager Practice Test

CGFM - Certified Government Financial Manager Practice Test

CGFM Governmental Accounting and Fund Accounting 2