Essentials of Accounting for Governmental and Not-for-Profit Organizations 12th Edition

Chapter 01 - Introduction to Accounting and Financial Reporting for Governmental and Not-for-Profit Organizations 1-1 INSTRUCTORS MANUAL TO ACCOMPANY ESSENTIAL OF ACCOUNTING FOR GOVERNMENTAL AND NOT-FOR-PROFIT ORGANIZATIONS: TWELFTH EDITION PREPARED BY: MARY LORETTA MANKTELOW MARILLA S. MELCHER JAMES MADISON UNIVERSITY Chapter 01 -

Chapter 10 - Accounting for Private Not-for-Profit 10-1 CHAPTER 10 ACCOUNTING FOR PRIVATE NOT-FOR-PROFIT 10-1. ANSWERS WILL VARY DEPENDING ON STATEMENTS OBTAINED. 10-2. A. THE FINANCIAL REPORTS REQUIRED BY THE FASB FOR NONPROFIT ORGANIZATIONS ARE (1) STATEMENT OF FINANCIAL POSITION, (2) STATEMENT OF ACTIVITIES, AND (3) STATEMENT

Chapter 10 - Accounting for Private Not-for-Profit 10-18 10-18 10-18 10-12. THE GRANT WOOD ARTS ASSOCIATION GENERAL JOURNAL UNRESTRICTED THE GRANT WOOD ARTS ASSOCIATION GENERAL JOURNAL UNRESTRICTED THE GRANT WOOD ARTS ASSOCIATION GENERAL JOURNAL UNRESTRICTED DEBITS CREDITS 1. CASH CONTRIBUTIONS-UNRESTRICTED

Chapter 11 - College and University Accounting - Private Institutions 11-1 CHAPTER 11 College and University Accounting - Private Institutions 11-1. ANSWERS WILL VARY DEPENDING ON STATEMENTS OBTAINED. 11-2. A. PUBLIC (GOVERNMENT-OWNED) COLLEGES AND UNIVERSITIES. 1. GASB 2. STATEMENT OF NET POSITION, STATEMENT OF REVENUES, EXPENSES AND

Chapter 11 - College and University Accounting - Private Institutions 11-13 11-8 (B CONTINUED). LEE COLLEGE STATEMENT OF CHANGES IN NET ASSETS YEAR ENDED JUNE 30, 2015 TOTAL UNRESTRICTED REVENUES $ 16,265,000 NET ASSETS RELEASED FROM RESTRICTION 1,800,000

Chapter 12 - Accounting for Hospitals and Other Health Care Providers 12-1 CHAPTER 12 Accounting for Hospitals and Other Health Care Providers 12-1. a. CHARITY CARE: CHARITY CARE OCCURS WHEN A HOSPITAL OR OTHER HEALTH CARE ORGANIZATION PROVIDES CARE TO INDIVIDUALS WHERE THERE IS NO EXPECTATION OF COLLECTION.

CONTINUOUS PROBLEM CHAPTER 13 RATIO FORMULA CALCULATIONS CITY OF MONROE 1) FINANCIAL POSITION (GOVERNMENT- WIDE, GOVERNMENTAL ACTIVITIES) Unrestricted Net Position: Total Expenses: Governmental Activities 1,808,110 16,193,360 11.2% 2) FINANCIAL POSITION (GENERAL FUND) Unassigned Fund Balance Total Expenditures + Other Financing Uses

Chapter 13 - Auditing, Tax Exempt Organizations, and Evaluating Performance 13-1 13-1 13-1 CHAPTER 13 Auditing, Tax Exempt Organizations, and Evaluating Performance 13-1. THE SOLUTION TO THIS AND THE FIRST EXERCISE OF CHAPTERS 1 THROUGH 8 WILL VARY FROM STUDENT TO STUDENT, ASSUMING EACH HAS A DIFFERENT CAFR.

Chapter 14 Financial Reporting by the Federal Government 13-1 CHAPTER 14 Financial Reporting by the Federal Government 14-1. BASIC FINANCIAL STATEMENTS OF A FEDERAL AGENCY INCLUDE: o BALANCE SHEET, o STATEMENT OF NET COST o STATEMENT OF CHANGES IN NET POSITION o STATEMENT OF BUDGETARY RESOURCES o

Chapter 02 - Overview of Financial Reporting for State and Local Governments 2-1 CHAPTER 2 Overview of Financial Reporting for State and Local Governments 2-1. THE SOLUTION TO THIS AND THE FIRST EXERCISE OF CHAPTERS 1 AND 3 THROUGH 9 WILL DIFFER FROM STUDENT TO STUDENT ASSUMING EACH HAS

Chapter 03 Modified Accrual Accounting 3-1 ` CHAPTER 3: MODIFIED ACCRUAL ACCOUNTING: INCLUDING THE ROLE OF FUND BALANCES AND BUDGETARY AUTHORITY 3-1. THE SOLUTION TO THIS AND THE FIRST EXERCISE OF CHAPTERS 1 AND 2 AND 4 THROUGH 9 WILL DIFFER FROM STUDENT TO STUDENT ASSUMING EACH HAS A

City of Monroe - General Fund Journal Entries reference Account Titles Debits Credits 3-C Estimated Revenues Control 11,250,000 Appropriations Control 9,300,000 Estimated Other Financing Uses Control 1,700,000 Budgetary Fund Balance 250,000 4-C 1 Encumbrances Control 17,000 Budgetary Fund Balance - Reserve for Encumbrances 17,000 2 Deferred Inflows -Property Taxes 21,000 Revenues Control

Chapter 04 - Accounting for the General and Special Revenue Funds 4-1 4-1 4-1 CHAPTER 4 Accounting for the General and Special Revenue Funds 4-1. THE SOLUTION TO THIS AND THE FIRST EXERCISE OF CHAPTERS 1 THROUGH 9 WILL DIFFER FROM STUDENT TO STUDENT, ASSUMING EACH HAS A DIFFERENT

Chapter 04 - Accounting for the General and Special Revenue Funds 4-12 4-9 (B) NEWPORT CITY 911 CALL CENTER SPECIAL REVENUE FUND STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE FOR THE YEAR ENDED DECEMBER 31, 2015 REVENUES: PHONE TAXES $

City of Monroe Street and Highway Fund - General Ledger DUE FROM reference Account Titles Debits Credits CASH INVESTMENTS STATE GOV'T bb 21,000 bb 59,000 bb 109,000 3-C Estimated Revenues 1,068,000 2 985,000 11,072,000 Appropriations 1,047,000 55,120 985,000 2 Budgetary Fund Balance 21,000 923,000 6 4-C 1 Due From State Government 1,072,000 88,120 59,000 196,000

City of Monroe - City Jail Construction Fund CITY JAIL CAPITAL PROJECTS FUND CONTRACTS PAYABLE reference Account Titles Debits Credits CASH ACCOUNTS PAYABLE RETAINED PERCENTAGE 14,200,000 200,000 11,282,500 867,500 8 5-C-1 91,320,000 116,000 3 11 1,282,500 12 67,500 1 Cash 4,200,000 50,000 53,217,500 12 Other Financing Sources - Proceeds of Bonds 4,000,000 150,000 6 12

Accounting for Other Governmental Funds 5-18 CHAPTER 5 Accounting for Other Governmental Fund Types: Capital Projects, Debt Service, and Permanent CHAPTER 5 Accounting for Other Governmental Fund Types: Capital Projects, Debt Service, and Permanent CHAPTER 5 Accounting for Other Governmental Fund Types: Capital Projects, Debt Service, and Permanent

Accounting for Other Governmental Funds 5-30 5-12 (A). CITY OF SHARPESBURG LIBRARY BOOK PERMANENT FUND GENERAL JOURNAL DEBITS CREDITS 1. CASH REVENUES-ADDITION TO PERMANENT ENDOWMENTS 950,000 950,000 2. INVESTMENTS-BONDS CASH 950,000 950,000 3. CASH REVENUES-INVESTMENT INCOME-INTEREST 21,375

City of Monroe Stores Services Internal Service Fund STORES AND SERVICES INTERNAL SERVICE FUND INVENTORY OF DUE FROM reference Account Titles Debits Credits CASH SUPPLIES OTHER FUNDS LAND bb 31,000 bb 27,500 bb 27,000 bb bb 18,000 6-C-1 1No journal entry 227,000 15,000 4 3 303,500 296,960 527,000 2 7 360,000 5371,200 2Cash 27,000 355,700 9360,000 7 Due

Chapter 06 - Proprietary Funds 6-1 CHAPTER 6 Proprietary Funds 6-1. THE SOLUTION TO THIS AND THE FIRST EXERCISE OF CHAPTERS 1 THROUGH 9 WILL DIFFER FROM STUDENT TO STUDENT ASSUMING EACH HAS A DIFFERENT CAFR. DIFFER FROM STUDENT TO STUDENT ASSUMING EACH HAS A DIFFERENT CAFR. DIFFER FROM

Chapter 06 - Proprietary Funds 6-19 6-19 6-19 6-11 (A) - CONTINUED CITY OF EVANSVILLE SUMMER CAMP ENTERPRISE FUND STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN FUND NET POSITION FOR THE YEAR ENDED DECEMBER 31, 2015 OPERATING REVENUES: CHARGES FOR SALES

City of Monroe Community Foundation Trust Fund COMMUNITY FOUNDATION TRUST FUND ACCRUED reference Account Titles Debits Credits CASH INTEREST RECEIVABLE bb 49,500 bb 7,500 7-C-1 1Cash 22,500 122,500 200,000 27,500 1 Accrued Interest Receivable 7,500 2206,026 203,500 5 7 7,500 Additions-Investment Earnings-Interest 15,000 322,500 50,000 6 44,000 5203,500 2 Cash 206,026 Additions-Contributions-Individuals & Foundations 206,026 54,526 7,500 Investment

Chapter 07 - Fiduciary Funds 7-1 CHAPTER 7: Fiduciary Funds CHAPTER 7: Fiduciary Funds CHAPTER 7: Fiduciary Funds 7-1. THE ANSWERS TO THIS EXERCISE, AND TO THE FIRST EXERCISE OF CHAPTERS 1 THROUGH 9 WILL VARY FROM STUDENT TO STUDENT, ASSUMING EACH HAS A DIFFERENT CAFR. AGENCY FUNDS THROUGH

Chapter 07 - Fiduciary Funds 7-15 7-15 7-15 7-13 (C). CITY OF SWEETWATER EMPLOYEES' RETIREMENT FUND STATEMENT OF FIDUCIARY NET POSITION AS OF JUNE 30, 2015 ASSETS: CASH ACCRUED INTEREST RECEIVABLE INVESTMENTS, AT FAIR VALUE: BONDS STOCKS TOTAL ASSETS $ 132,000 60,000

CITY OF MONROE WORKSHEET TO CONVERT GOVERNMENTAL ACTIVITIES TO ACCRUAL BASIS Refr. Account Titles Debits Credits Gov'tal Fund Balances Adjustments & Eliminations Govern- mental Funds Adjusted Internal Service Funds Balances for Gov't-wide Stmts Debits Credits Debits Credits ACapital Assets 65,900,000 DEBITS: Accumulated Depreciation 29,800,000 Cash 830,320 830,320 M47,300 877,620 Net Position 36,100,000 Cash

Chapter 8 Government-Wide Statements, Capital Assets, Long-Term Debt 8-1 CHAPTER 8: Government-Wide Statements, Capital Assets, Long-Term Debt 8-1. THE SOLUTION TO THIS AND THE FIRST EXERCISE OF CHAPTERS 1 THROUGH 8 WILL DIFFER FROM STUDENT TO STUDENT ASSUMING EACH HAS A DIFFERENT CAFR. 8-2. THE MOST COMMON

Chapter 09 - Accounting for Special-Purpose Entities, Including Public Colleges and Universities 9-1 CHAPTER 9 Accounting for Special-Purpose Entities, Including Public Colleges and Universities 9-1. THE SOLUTION TO THIS PROBLEM WILL DIFFER FROM STUDENT TO STUDENT, ASSUMING EACH HAS A DIFFERENT COLLEGE FINANCIAL REPORT. 9-2. A. SPECIAL-PURPOSE

AWG EDUCATIONAL FOUNDATION - a private not-for-profit journal entries and General ledger PLEDGES ACCRUED INTEREST CASH RECEIVABLE RECEIVABLE SUPPLIES Association of Women in Government bb 22,900 bb 27,232 bb 700 bb 400 Educational Foundation 2,200 1 5 1,362 700 3 1 1,900 December 31, 2015 29,600 1,200 110,000 5 3

financial statements Unrestricted Temporarily Restricted Permanently Restricted Total Revenues Student Tuition and Fees 1,508,000$ 1,508,000$ State Appropriations 700,000 700,000 Contributions to Endowment 105,700$ 105,700 Federal Grants 175,000$ 175,000 Investment Income 66,000 66,000 Net assets released from restriction: - Satisfaction of program

Exercise 12-9 General Ledger Journal Entries debits credits CASH PATIENT ALLOWANCE FOR 1 Patient Accounts Receivable 21,130,000 bb 830,000 ACCOUNTS RECEIVABLE UNCOLLECTABLE ACCOUNTS SUPPLIES CONTRIBUTIONS RECEIVABLE Unrestricted-Patient Service Revenue 21,130,000 1 17,600,000 1,600,000 9 bb 3,250,000 650,000 bb bb 130,000 bb 2,480,000 2 2,530,000 2,200,000 10 1 21,130,000 4,350,000 1 3 430,000

CITY OF Grafton Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual: General Fund For The Year Ended December 31, 2015 Budgeted Amounts REVENUES Original Final Actual Amounts Budgetary Basis Variance with Final Budget Property Taxes 3,205,000$ 3,205,000 3,212,000 7,000$ Licenses and permits 800,000 800,000 803,000 3,000

State Government - Special Revenue Fund CASH LICENSE FEES RECEIVABLE SUPPLIES Fish and Game Fund Journal Entries bb 200,000 bb 125,000 bb 9,000 December 31, 2015 31,150,000 303,000 7125,000 3 6 287,500 4272,000 305,000 9 3 128,000 283,650 12 Item # Account Title Debits Credits 8300,000 977,000 10 1 Estimated Revenues 1,400,000 Estm'

JOURNAL ENTRIES State Government Capital Project Fund Journal Entries December 31, 2015 Account Title Debits Credits 1 Encumbrances 1,700,000 Budgetary Fund Balance - Reserve for encumbrances 1,700,000 2 Cash 25,412,000 Taxes receivable 2,550,000 Fuel tax revenues 22,862,000 Taxes receivable 3,105,000 Fuel tax revenues 3,105,000 3 Encumbrances 29,000,000 Budgetary Fund Balance - Reserve

Rural County - journal entries and General ledger Special Revenue fund CAPITAL ASSETS CASH FEES RECEIVABLE SUPPLIES (NET OF ACCL DEPR) Rural County bb 85,000 Special Revenue Fund Journal Entries 385,250 37,300 December 31, 2015 89,900 3 6 2,400 7500 7,040 8 Account Title Debits Credits 1 Cash 85,000 80,350 2,400 760 -

Moose County - journal entries and General ledger Permanent fund INVESTMENTS IN INVESTMENTS IN ACCRUED INTEREST CASH CORPORATE EQUITIES CORPORATE BONDS RECEIVABLE Moose County Permanent Fund Journal Entries 2180,000 12,700,000 13,000,000 112,000 December 31, 2015 3168,000 150,000 5 5 190,000 12,000 2 320,000 4 2 45,000 Account Title Debits Credits 1 Investments - corporate equities 2,700,000

Background Information: Financial Statements - Governmental Funds CITY OF COTTONWOOD Balance Sheet Governmental Funds As of December 31, 2015 General Special Revenue Courthouse Renovation Debt Service Permanent Total Governmental ASSETS Fund Fund Fund Fund Fund Funds Cash and cash equivalents 6,408,214 627,837 895,300 230,000 8,161,351 Investments 3,312,992 3,312,992

Exercise 9--9 Cherokee Library District Type journal entries to convert to the accrual basis in the space below and post them to the financial statements on the next two tabs. debits credits a Capital Assets 19,500,000 Accumulated Depreciation 6,330,000 Net Position 13,170,000 Depreciation Expense 418,000 Accumulated Depreciation 418,000 Capital Assets 7,994,632

1 GOVERNMENTAL ACCOUNTING PRACTICE SET Part A due: Part B due: Introduction The date is December 31, 2091. You have just risen from a three month cryogenic sleep during which you traveled from Earth to Europa, the only inhabited moon of

ENTERPRISE FUND - GENERAL LEDGER Journal Entries debits credits DUE FROM 3 Feb. 1 Cash 300,000 CASH OTHER FUNDS SUPPLIES ACCOUNTS RECEIVABLE Transfer in - capital contribution 300,000 bb - bb - bb - bb - To record contribution from GF - - - - ALLOWANCE FOR UNCOLLECTIBLE ACCTS BUILDINGS & STRUCT EQUIPMENT GEOTHERMAL GENERATORS -

General Fund - General Ledger # date Journal Entries debits credits CASH 1 Jan. 1 Encumbrances 11,806 bb 18,000 ALLOWANCE FOR Budgetary Fund Balance Reserve for Encumbrances 11,806 TAXES RECEIVABLE UNCOLLECTIBLE TAXES SUPPLIES additional debit account To re-establish outstanding encumbrances bb - - bb bb 13,000 - - 13,000 - 18,000 SHORT-TERM DUE

Worksheet to convert Governmental fund basis information to accrual basis #Journal Entries debits credits (enter as negatives) Gov'tal Fund Balances Adjustments & Eliminations Balances for Gov't-wide Stmts type accounts to be debited here Debits Credits type accounts to be credited here DEBITS: Cash 2,123,249 2,123,249 Taxes Receivable, net 559,000 559,000 Inventories 116,000 116,000 Capital Assets

_______________________________________________________________________________________________ School of Accounting MSC 0203 Harrisonburg, VA 22807 Phone (540) 568-3071 Fax (540) 568-3017 TO: Adopters of Essentials 11th Edition FROM: Paul Copley SUBJECT: Practice Set The Twelfth Edition provides a practice set that is a middle ground between the comprehensive continuous problem

ENTERPRISE FUND - GENERAL LEDGER Journal Entries debits credits DUE FROM 3 Feb. 1 Cash 300,000 CASH OTHER FUNDS SUPPLIES ACCOUNTS RECEIVABLE Transfer in - capital contribution 300,000 bb - bb - bb - bb - To record contribution from GF 3300,000 1,045,000 921 920,000 91,100,000 21 2,120,000 21 805,000 632,500 17 805,000

General Fund - General Ledger # date Journal Entries debits credits CASH 1 Jan. 1 Encumbrances 11,806 bb 18,000 ALLOWANCE FOR Budgetary Fund Balance Reserve for Encumbrances 11,806 5450,000 300,000 3TAXES RECEIVABLE UNCOLLECTIBLE TAXES SUPPLIES additional debit account To re-establish outstanding encumbrances 63,030,000 11,501 7bb - - bb bb 13,000 19 1,230,000 900,000 8

Worksheet to convert Governmental fund basis information to accrual basis Journal Entries debits credits (enter as negatives) Gov'tal Fund Balances Adjustments & Eliminations Balances for Gov't-wide Stmts 1 Capital Assets 1,875,000 Debits Credits Bonds Payalbe 1,875,000 DEBITS: to record beginning balances LT debt and capital assets Cash 2,123,249 2,123,249 Taxes Receivable, net 559,000 559,000 2 Capital

1) The single audit requirements apply only to state and local governments. Private not-for-profits do not have to comply with these requirements, even if they receive federal grants. Answer: False Answer: False Answer: False 2) For most state and local governments, the budget, when adopted according to procedures specified by state

1) A fire protection district is anexample of specialpurpose local government. Answer: True Answer: True Answer: True 2) The residual classification for governmental funds other than the General Fund is Assigned. Answer: True Answer: True Answer: True 3) When closing the General Fund and Special Revenue Funds of a state or local

1) The Proprietary Fund Statement of Revenues, Expenses, and Changes in Fund Net Position must include a performance indicator, such as operating income. Answer: True Answer: True Answer: True 2) If a private not-for-profit fails to comply with donor restriction on contributions received, the organization must accrue and disclose a contingent

1) The program expense ratio is calculated as Program service expenses / Total expenses. Answer: True Answer: True Answer: True 2) FASB sets the reporting standards for private not-for-for profits. Answer: True Answer: True Answer: True 3) Governments must capitalize infrastructure assets in the government-wide statements Answer: True Answer: True Answer: True 4)

1) Budgetary comparison schedules are not required for proprietary funds. Answer: True Answer: True Answer: True 2) The GASB Concept Statement on Service Efforts and Accomplishments Reporting requires state and local governments to include inputs of nonmonetary resources in their financial reporting. Answer: False Answer: False Answer: False 3) General state appropriations are

1) In addition to the government-wide statements, governments are required to prepare fund financial statements for governmental, proprietary and fiduciary funds. Answer: True Answer: True Answer: True 2) Unexpended Appropriations Balance may be interpreted as how much a government may continue to spend and remain within its budget. Answer: True Answer: True

1) Examples of budgetary accounts include Estimated Revenues, Appropriations, and Estimated Other Financing Uses. Answer: True Answer: True Answer: True 2) The Governmental Accounting Standards Board sets financial reporting standards for all units of government: federal, state, and local. Answer: False Answer: False Answer: False 3) According to the rules for accounting for

1) Capital projects funds are always included in the Budgetary Comparison Schedule. Answer: False Answer: False Answer: False 2) Allotmentsare made at the agency level and assign portions of the appropriation to subunits or programs. Answer: True Answer: True Answer: True 3) To apply for tax-exempt status, an organization must complete an

1) An internal service fund is required whenever an activity is funded by fees or charges from other government departments. Answer: False Answer: False Answer: False 2) Unless use of an agency fund is mandated by law, by GASB standards, or by decision of the governing board of a government, an agency

1) According to the rules for accounting for colleges and universities under the jurisdiction of the FASB, expenses are reported by function, either in the statements or in the notes. Answer: True[/cpmembership] Answer: True[/cpmembership] Answer: True[/cpmembership] 2) A Statement of Functional Expenses is not required for private voluntary health and welfare

1) The current and long-term portions of General Long-term Debt are normally reported in a debt service fund. Answer: False Answer: False Answer: False 2) Investment Trust Funds account for only the external portion of investment pools. Answer: True Answer: True Answer: True 3) Private colleges and universities use the economic resources measurement

1) Employers with defined contribution plans will report a pension liability if the required contribution has not been fully paid by year end. Answer: True Answer: True Answer: True 2) Fiduciary funds are reported only in the fund-basis financial statements. Answer: True Answer: True Answer: True 3) An annuity serial bond is

1) Revenue for reimbursement grants may be recognized before expenditures take place as long as the grant has been awarded. Answer: False Answer: False Answer: False 2) The Fiduciary Funds are included in the Government-Wide Financial Statements. Answer: False Answer: False Answer: False 3) There are no expenses in modified accrual funds. Answer: True

1) Assuming an auditee is not considered low-risk, the auditor is required to express an opinion on compliance on major programs, which must add up to 90 percent of federal funds expended by the auditee. Answer: False Answer: False Answer: False 2) Governments and other nonprofits receiving federal funds follow Governmental

1) Business activities fund statements must be changed to the accrual basis from the modified accrual basis when preparing government-wide financial statements. Answer: False Answer: False Answer: False 2) When preparing the government-wide statements, an entry is required to record depreciation expense on general capital assets Answer: True Answer: True Answer: True

1) Government-wide statements are to be prepared using the current financial resources measurement focus and modified accrual basis of accounting. Answer: False Answer: False Answer: False 2) FASB requires that the reconciliation of income and cash flows from operations starts with operating income. Answer: False Answer: False Answer: False 3) When using

1) In the General Fund, revenues are recognized when measurable and earned. Answer: False Answer: False Answer: False 2) The most numerous and important enterprise services rendered by local governments are public utilities. Answer: True Answer: True Answer: True 3) A fund represents part of the activities of an organization which is separated

1) Country clubs and labor unions are not included in the category other not-for-profit organizations because they provide benefit to their members only and not to the general public. Answer: False Answer: False Answer: False 2) Both governmental owned and private health care providers use the modified accrual basis of accounting and

1) According to GASB 34, restricted Net Position does not include those that are the results of constraints imposed by creditors, grantors, contributors, or laws or regulations of other governments. Answer: False Answer: False Answer: False 2) When preparing fund basis financial statements, any funds not reported separately are aggregated and reported

1) Fiduciary funds include agency, pension trust, investment trust, and permanent funds. Answer: False Answer: False Answer: False 2) Escheat property, often collected by the state, is to be reported either in a private-purpose trust fund or in the fund to which the property ultimately reverts. Answer: True Answer: True Answer: True

1) Unrelated Business Income Tax is an excise tax, applied to the gross receipts of a business activity. Therefore allocations of expenses incurred in generating the income are irrelevant. Answer: False Answer: False Answer: False 2) The Statement of Custodial Activity is not required of every federal agency but is prepared

1) Tax-exempt organizations are required to file Form 990 by the 15th day of the 9th month following the organizations taxable year. Answer: False Answer: False Answer: False 2) Service Efforts and Accomplishments Reporting includes measures of service inputs, outputs and outcomes. Answer: True[/cpmembership] Answer: True[/cpmembership] Answer: True[/cpmembership] 3) Special-purpose governments that are

1) Universities treat athletic scholarships as a reduction in revenue. Answer: True Answer: True Answer: True 2) The Comprehensive Annual Financial Report (CAFR) contains four major sections: introductory, financial, supplementary, and statistical. Answer: False Answer: False Answer: False 3) Private-purpose Trust Funds benefit individuals, private organizations, or other governments. Answer: True Answer: True

1) Inflows from self-supporting university operations, known as auxiliary enterprises, are unrestricted. Answer: True Answer: True Answer: True 2) Supporting expenses are included in the numerator of the program expense ratio. Answer: False Answer: False Answer: False 3) Public higher education institutions that report as special-purpose entities engaged in business-type activities only

1) When converting from governmental fund financial statements to the governmental activities column of the government-wide statements, the proceeds from the sale of capital assets which were listed as an other financing source are eliminated and the gain or loss is recorded when preparing the government-wide statements. Answer: True Answer: True Answer:

1) The Financial Accounting Standards Board and the Governmental Accounting Standards Board are parallel bodies under the oversight of the Financial Accounting Foundation. Answer: True Answer: True Answer: True 2) General-purpose governments are those that offer more than one type of basic governmental service, while special-purpose entities generally provide a limited,

1) Present and potential donors are the primary users of private not-for-profit financial statements. Answer: True Answer: True Answer: True 2) GASB standards for property tax revenue recognition under the modified accrual basis of accounting provide that revenue is permitted to be recorded if the expected amount to be collected can be

1) The government-wide financial statements present the government as a whole, including component units and including fiduciary activities. Answer: False Answer: False Answer: False 2) Special-purpose governments generally provide a limited set of services or programs. Answer: True Answer: True Answer: True 3) A non exchange transaction is one where a government

1) Proprietary funds do not record capital assets, depreciation on those capital assets, and long-term debt. Answer: False Answer: False Answer: False 2) The Budgetary Comparison Schedule requires a column for the original budget, a column for the final revised budget, and a column for actual figures, computed on the accrual

1) Governmental attestation engagements must comply with the Government Auditing Standards but are exempt from compliance with the Answer: False Answer: False Answer: False 2) General long-term debt, to be paid out of resources of the government's taxing power, is reported in both the governmental fund Balance Sheet and the government-wide

1) An investment trust fund is used to account for the internal portion of a multi-government investment pool, when the reporting government is trustee. Answer: False Answer: False Answer: False 2) Long term liabilities of an enterprise fund are reported in the proprietary fund statement and in government-wide statements. Answer: True Answer:

1) Churches must file a Form 990 . Answer: False Answer: False Answer: False 2) All donated services are recognized as revenue. Answer: False Answer: False Answer: False 3) The introductory and statistical sections of a CAFR are required to be audited. Answer: False Answer: False Answer: False 4) Contributions of assets other

1) Typically, budgetary authority that is not obligated by a federal agency before the end of the fiscal year rolls over and is available for the following fiscal year. Answer: False Answer: False Answer: False 2) For hospitals, contractual adjustments to 3rd party payers, such as insurance companies, are recorded with

1) The FASB requires private not-for-profit organizations to report net assets (the excess of assets over liabilities) separated by unrestricted, temporarily restricted and permanently restricted. Answer: True Answer: True Answer: True 2) Special-purpose governments that are engaged in both governmental and business-type activities are required to use the full reporting model

1) The three major sections of a CAFR are the Introductory, Financial, and Statistical sections. Answer: True Answer: True Answer: True 2) The FASAB was established to recommend accounting and financial reporting standards for the federal government. Answer: True Answer: True Answer: True 3) Governmental Auditing Standards identifies four categories of professional

1) With respect to private colleges and universities, why are quasi-endowments not classified as permanently restricted net assets while True endowments are? Answer: Quasi-endowments are established by the governing board of a college or university and designated for permanent investment. True endowments are provided by outside donors. FASB Statement 116

1) Special-purpose governments engaged in business type activities only are required to prepare both proprietary fund and government-wide financial statements. Answer: False Answer: False Answer: False 2) The Single Audit Actis intended to provide assurance to the federal government that federal funds are protected through a system of internal controls and sound

1) Proprietary funds record the net pension liability as a fund liability. Answer: True Answer: True Answer: True 2) Unmatured principal installments and accrued interest which is due shortly after year end are required to be reported as liabilities in the debt service fund at year end. Answer: False Answer: False Answer: False

1) Unexpended intergovernmental grants and taxes dedicated to capital improvements in a capital projects fund are likely to be classified as Restricted Fund Balance Answer: True Answer: True Answer: True 2) Financial statements prepared for private colleges and universities present net assets as: unrestricted, restricted, or net investment in capital assets. Answer:

1) The term fiduciary funds include agency, pension trust, investment trust, and private purpose trust funds. Answer: True Answer: True Answer: True 2) The required financial statements for agency funds includea Statement of Fiduciary Net Position, and a Statement of Changes in Fiduciary Net Position. Answer: False Answer: False Answer: False 3)

1) A Charitable lead trust is a type of split-interest agreement. Answer: True Answer: True Answer: True 2) NACUBO guidelines treat estimates of uncollectible accounts as reductions in revenue. Answer: True Answer: True Answer: True 3) Positive fund balances of capital projects funds are classified as nonspendable, restricted, committed, or assigned. Answer: True

1) In a governmental audit the auditor is required to report directly to appropriate officials in addition to the board or audit committee. Answer: True Answer: True Answer: True 2) An asset may be considered impaired if either the decline in the service utility is unexpected or the amount of the

1) The Answer: True Answer: True Answer: True 2) According to the rules for accounting for colleges and universities under the jurisdiction of the FASB, depreciation is recorded. When reporting by function, depreciation is allocated to functional categories. Answer: True Answer: True Answer: True 3) NACUBO guidelines require both revenues and expenses