GAC Governmental Accounting Principles & Standards 2

Question 1

Under GASB Statement No. 34, which financial statements are required for governmental funds?

Accepted Answer

Balance sheet and statement of revenues, expenditures, and changes in fund balances

Answer

GASB 34 requires governmental funds to present a balance sheet and a statement of revenues, expenditures, and changes in fund balances.

Question 2

Which GASB concept establishes the hierarchy of generally accepted accounting principles for state and local governments?

Accepted Answer

GASB Statement No. 55

Answer

GASB Statement No. 55 establishes the GAAP hierarchy for state and local governmental entities.

Question 3

What is the measurement focus used by proprietary funds in governmental accounting?

Accepted Answer

Economic resources

Answer

Proprietary funds use the economic resources measurement focus, recognizing all assets and liabilities.

Question 4

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

Accepted Answer

Available and measurable

Answer

Modified accrual requires revenues to be both measurable and available (collectible within the current period or soon enough to pay current liabilities).

Question 5

Which fund type is used to account for resources that are legally restricted to expenditure for specific purposes other than debt service or capital projects?

Accepted Answer

Special revenue fund

Answer

Special revenue funds account for revenues that are legally restricted or committed to specific purposes other than debt service or capital projects.

(GAC) Governmental Accounting Certification Practice Test

(GAC) Governmental Accounting Certification Practice Test

GAC Governmental Accounting Principles & Standards 2