CPRE Finance and Budgeting 2

Question 1

Which cost allocation method assigns indirect costs based on specific activities that drive those costs?

Accepted Answer

Activity-based costing

Answer

Step-down method

Answer

Simplified allocation method

Answer

Direct method

Question 2

Depreciation on park infrastructure is recorded primarily to:

Accepted Answer

Match the cost of long-lived assets with the periods they benefit

Answer

Reduce taxable income

Answer

Establish replacement fund balances

Answer

Comply with bond covenants

Question 3

A park district issues general obligation bonds. The primary security pledged to bondholders is:

Accepted Answer

The full faith and credit and taxing power of the government

Answer

Facility revenues

Answer

Federal grant funds

Answer

A specific capital project cash flow

Question 4

A cost-benefit analysis for a new recreation center should express benefits and costs in:

Accepted Answer

Present value terms

Answer

Nominal dollars without adjustment

Answer

Future value terms

Answer

Per-capita terms only

Question 5

Which financial document provides a snapshot of an agency's assets, liabilities, and net position at a specific point in time?

Accepted Answer

Statement of net position

Answer

Statement of revenues and expenditures

Answer

Cash flow statement

Answer

Budget variance report

Question 6

When a park agency's actual revenues fall short of budgeted revenues mid-year, the recommended first response is to:

Accepted Answer

Implement a budget amendment reducing expenditure appropriations

Answer

Issue short-term debt to cover the shortfall

Answer

Transfer funds from the capital fund

Answer

Request an emergency tax levy