CPA Governmental & Not-for-Profit Accounting 2

Question 1

Which governmental fund is used to account for the accumulation of resources for and the payment of general long-term debt principal and interest?

Accepted Answer

Debt Service Fund

Answer

Capital Projects Fund

Answer

Special Revenue Fund

Answer

Internal Service Fund

Question 2

Under the modified accrual basis, property tax revenues are recognized when they are:

Accepted Answer

Measurable and available within 60 days after year-end

Answer

Levied by the government

Answer

Collected in cash

Answer

Billed to property owners

Question 3

A not-for-profit hospital receives a $500,000 donation restricted by the donor for equipment purchases. Before the equipment is purchased, this amount should be classified as:

Accepted Answer

Net assets with donor restrictions

Answer

Revenue without donor restrictions

Answer

A liability

Answer

Deferred revenue

Question 4

Which GASB concept requires governments to report on their fiscal accountability by using the modified accrual basis in fund statements?

Accepted Answer

Fiscal accountability

Answer

Operational accountability

Answer

Economic accountability

Answer

Stewardship accountability

Question 5

In governmental accounting, which of the following would be recorded as an expenditure rather than an expense?

Accepted Answer

Depreciation of general capital assets

Answer

Interest accrued on revenue bonds

Answer

Salaries payable to government employees

Answer

Loss on sale of equipment

Question 6

The Comprehensive Annual Financial Report (CAFR) required of governments includes which three sections?

Accepted Answer

Introductory, Financial, and Statistical

Answer

Budget, Financial, and Audit

Answer

Management, Financial, and Notes

Answer

Executive, Legislative, and Financial

Question 7

Under FASB ASC 958 for not-for-profits, which of the following is required to be presented in the statement of cash flows?

Accepted Answer

Operating, Investing, and Financing activities

Answer

Only operating and investing activities

Answer

Restricted and unrestricted activities separately

Answer

Fund-by-fund cash activity