CPRE Finance and Budgeting

Question 1

Which budgeting approach requires each department to justify all expenditures from scratch each fiscal year?

Accepted Answer

Zero-based budgeting

Answer

Incremental budgeting

Answer

Line-item budgeting

Answer

Performance budgeting

Question 2

A park district's capital improvement plan (CIP) typically covers what time horizon?

Accepted Answer

5–10 years

Answer

1 year

Answer

2 years

Answer

20+ years

Question 3

Which financial ratio measures an agency's ability to meet short-term obligations?

Accepted Answer

Current ratio

Answer

Debt-to-equity ratio

Answer

Return on investment

Answer

Operating ratio

Question 4

Enterprise fund accounting is used in parks and recreation primarily to:

Accepted Answer

Account for activities that are largely self-supporting through user fees

Answer

Track grant expenditures separately

Answer

Manage endowment investments

Answer

Record intergovernmental transfers

Question 5

Which standards body governs the financial reporting requirements for local government agencies including park districts?

Accepted Answer

GASB

Answer

FASB

Answer

SEC

Answer

OMB

Question 6

A park agency receives a $500,000 grant that must be spent on trail construction only. This is best classified as:

Accepted Answer

Restricted revenue

Answer

General fund revenue

Answer

Unrestricted contribution

Answer

Capital lease proceeds