54) The measurement focus and basis of accounting that are most unlike those used by business
entities are those used by
A) Governmental funds.
B) Fiduciary funds.
C) Proprietary funds.
D) Contribution funds.
55) Which of the following governmental funds must be reported as a major fund?
A) The General Fund.
B) Any fund with total assets, liabilities, revenues, or expenditures that are 10% or more of the
General Fund and 5% or more of total General Fund and Business-type Activities.
C) The government may opt to include or exclude any fund it choses as a major fund.
D) Only the General Fund and special revenue funds that meet the 10% and 5% size criteria.
56) The basis of accounting that should be used in preparing fund financial statements is:
Governmental funds
Proprietary funds
Fiduciary funds
A)
Modified accrual
Accrual
Modified accrual
B)
Modified accrual
Modified accrual
Modified accrual
C)
Modified accrual
Accrual
Accrual
D)
Accrual
Accrual
Accrual
A) Choice A
B) Choice B
C) Choice C
D) Choice D
57) A major governmental fund is one that has one or more elements (e.g., assets, liabilities,
revenues, or expenditures) that is at least:
A) Five percent of the corresponding element(s) of total governmental funds and 10 percent of the
corresponding element(s) of total governmental and enterprise funds combined.
B) Ten percent of the corresponding element(s) of total governmental funds and 10 percent of the
corresponding element(s) of total governmental and enterprise funds combined.
C) Five percent of the corresponding element(s) of total governmental funds and five percent of
the corresponding element(s) of total governmental and enterprise funds combined.
D) Ten percent of the corresponding element(s) of total governmental funds and 5 percent of the
corresponding element(s) of total governmental and enterprise funds combined.
58) A city received resources that the state indicates can only be used for public works projects,
such as road construction. Assuming the resources have not been expended by year end, how
would the resources the city received be shown in the city’s fund balances?
A) Designated Fund Balance.
B) Committed Fund Balance.
C) Restricted Fund Balance.
D) Assigned Fund Balance.
59) Which of the following would be reported as a nonspendable fund balance?
A) Inventory.
B) Restricted assets.
C) Assets whose use is limited.
D) Capital assets.
60) Under GASB standards which of the following funds can report a positive amount for
unassigned fund balance?
A) Capital projects fund.
B) Special revenue fund.
C) General Fund.
D) All of the options.
61) Use the following information to determine whether the Development Special Revenue and
the Debt Service Funds should be reported as major funds based on asset amounts provided.
Development Special Revenue Fund Assets
$
740,000
Debt Service Fund Assets
$
150,000
Total Governmental Fund Assets
$
7,500,000
Total Governmental Fund and Enterprise Fund Assets
$
8,750,000
A) The Development Special Revenue Fund should be reported as major.
B) The Debt Service Fund should be reported as major.
C) Both the Development Special Revenue Fund and the Debt Service Fund should be reported as
major.
D) Neither the Development Special Revenue Fund nor the Debt Service Fund should be reported
as major.
62) Which of the following is not one of the seven elements defined by the GASB concept
statements?
A) Deferred inflow of resources.
B) Expenses.
C) Assets.
D) Net position.
63) The GASB concept statements indicate that in certain instances a remeasured value for an asset
or liability should be reported on the financial statements. Which of the following is not one of the
methods recommended by the GASB for remeasured amounts?
A) Historical cost.
B) Lower of cost or market.
C) Fair value.
D) Replacement cost.
64) The GASB recommends that budget–to-actual comparison information be provided as which
of the following?
A) A stand-alone financial statement.
B) A schedule in the notes to the financial statements.
C) As a part of the basic financial statements.
D) As a required supplementary information schedule.
65) The GASB requires budget-to-actual comparison information for which of the following?
A) The General Fund.
B) All governmental funds.
C) The General Fund and major special revenue funds with legally adopted budgets.
D) All special revenue, debt service and capital projects funds with legally adopted budgets.
66) For each of the following descriptive phrases, indicate the type of fund from the list.
A. Governmental funds
B. Proprietary funds
C. Fiduciary funds
________ 1. Includes permanent funds held in trust to be used for public purposes
________ 2. Sometimes referred to as self-supporting or business-like funds
________ 3. Any fund held by a government in a custodial or trustee relationship for an external
party
________ 4. Used when the government collects taxes or amounts to be invested for external
parties
________ 5. Enterprise and internal service funds