32) Extraordinary items and special items are reported on the government-wide statement of
activities.
A) With normal recurring general revenues.
B) As separate line items in the Function/Programs section of the statement of activities.
C) As separate line items below General Revenues in the statement of activities.
D) As separate line items above General Revenues.
33) Which of the following items would not appear in a statement of revenues, expenditures, and
changes in fund balances prepared for a governmental fund?
A) Depreciation expense.
B) Interfund transfers in.
C) Revenues from property taxes.
D) Expenditures for employee salaries.
34) Which of the following would always be classified as a general revenue?
A) Grant proceeds.
B) Special assessment charges for snow removal.
C) Library fines.
D) Fuel taxes earmarked for maintenance of roads and bridges.
12
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35) The cost to purchase a good or service is the definition of an
A) Expenditure.
B) Expense.
C) Other financing use.
D) Interfund transfer out.
36) Which of the following would not appear on a governmental fund balance sheet?
A) Accounts receivable.
B) Inventory.
C) Vouchers payable.
D) Bonds payable.
37) When the budget for the General Fund is recorded, the required journal entry will include:
A) A credit to Estimated Revenues.
B) A debit to Encumbrances.
C) A credit to Appropriations.
D) A credit to Fund Balance.
38) When the budget of a government is recorded and Appropriations exceeds Estimated
Revenues, the Budgetary Fund Balance account is:
A) Credited at the beginning of the year and debited at the end of the year.
B) Credited at the beginning of the year and no entry is made at the end of the year.
C) Debited at the beginning of the year and no entry is made at the end of the year.
D) Debited at the beginning of the year and credited at the end of the year.
39) Which of the following accounts is a budgetary account of a governmental fund?
A) Encumbrances.
B) Appropriations.
C) Expenditures.
D) Other Financing Sources.
40) The Estimated Revenues control account of a government is credited when:
Budgetary accounts are closed
Revenues are recorded
A)
Yes
No
B)
No
No
C)
No
Yes
D)
Yes
Yes
A) Choice A.
B) Choice B.
C) Choice C.
D) Choice D.
14
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Topic: Budgetary Accounting
Learning Objective: 03-05 Explain how budgetary accounting contributes to achieving
budgetary control over revenues and expenditures, including such aspects as: recording and
revising the annual budget; accounting for revenues, encumbrances, and expenditures; closing
budgetary accounts; and accounting for allotments.
Bloom’s: Apply
AACSB: Knowledge Application
AICPA: FN Reporting
41) Under the modified accrual basis of accounting used by the General Fund, financial resources
are considered available if the revenue or other financing source is expected to be collected
A) Within 60 days after year-end.
B) Within 90 days after year-end.
C) During the current fiscal period.
D) During the current fiscal period or soon enough after year-end to pay current period obligations.
42) Which of the following accounts of a government is credited when a purchase order is
approved?
A) Encumbrances.
B) Encumbrances Outstanding.
C) Vouchers Payable.
D) Appropriations.
15
43) The Expenditures control account of a government is debited when:
A) The supplies budget is recorded.
B) Supplies are ordered.
C) Supplies previously encumbered are received.
D) The invoice for supplies is paid.
44) Which of the following is true regarding other financing sources and other financing uses?
A) Both must be reported separately from revenues and expenditures in the statement of revenues,
expenditures, and changes in fund balances.
B) These terms are used to distinguish program revenues or expenses from general revenues or
expenses.
C) These terms are used for minor revenue or expenditure items that are peripheral to the
government’s mission.
D) Other financing sources are equivalent to gains and other financing uses are equivalent to
losses.
45) Under which basis of accounting for a government should revenues be recognized in the period
when they are measurable and available?
Accrual basis
Modified accrual basis
A)
Yes
No
B)
No
No
C)
No
Yes
D)
Yes
Yes
A) Choice A.
B) Choice B.
C) Choice C.
D) Choice D.
46) The expenditure classification “Public Safety” is an example of which of the following types of
classifications?
A) Activity.
B) Function.
C) Character.
D) Object.
47) When supplies ordered for use in an activity accounted for in the General Fund are received at
an actual price that is more than the estimated price on the purchase order, the Encumbrance
account is:
A) Debited for the estimated price on the purchase order.
B) Credited for the estimated price on the purchase order.
C) Debited for the actual price for the supplies received.
D) Credited for the actual price for the supplies received.
48) A statement of revenues, expenditures, and changes in fund balances—budget and actual is:
A) Required by GAAP for the General Fund, special revenue funds, and all other governmental
fund types for which an annual budget has been adopted.
B) Required by GAAP for internal management reports only; not permitted for external financial
reporting.
C) Required by GAAP for all governmental fund types.
D) Optional under GAAP, as long as a budgetary comparison schedule is presented.
49) The account “Interfund Transfers In” would be classified in a General Fund statement of
revenues, expenditures, and changes in fund balance as a(an):
A) Revenue.
B) Other financing use.
C) Other financing source.
D) Current liability.
50) The expenditure classification “City Attorney” is an example of which of the following types
of classification?
A) Function.
B) Organization unit.
C) Character.
D) Program.
51) When the budget of a government is adopted and Estimated Revenues exceed Appropriations,
the excess is:
A) Credited to Budgetary Fund Balance.
B) Debited to Budgetary Fund Balance.
C) Debited to Encumbrances Outstanding.
D) Credited to Encumbrances Outstanding.
52) Which of the following depict the typical order of steps in the acquisition of goods and services
by an activity accounted for by the General Fund?
A) Appropriation, disbursement, encumbrance, expenditure.
B) Appropriation, encumbrance, expenditure, disbursement.
C) Encumbrance, appropriation, expenditure, disbursement.
D) Encumbrance, expenditure, appropriation, disbursement.
53) When equipment that is to be used by the General Fund is received, how should it be recorded?
A) Capital Asset.
B) Appropriation.
C) Encumbrances.
D) Expenditure.
19
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budgetary control over revenues and expenditures, including such aspects as: recording and
revising the annual budget; accounting for revenues, encumbrances, and expenditures; closing
budgetary accounts; and accounting for allotments.
Bloom’s: Understand
AACSB: Knowledge Application
AICPA: FN Reporting
54) The journal entry to record budgeted revenues will include:
A) A debit to Estimated Revenues.
B) A credit to Estimated Revenues.
C) A debit to Revenues Receivable.
D) Only a memorandum entry is necessary.
55) The County Commission of Seminole County adopted its General Fund budget for the year
ending June 30, comprising estimated revenues of $13,200,000 and appropriations of
$12,900,000. Seminole County utilizes the budgetary accounts required by GASB standards. The
journal entry to record budgeted appropriations will include:
A) A credit to Appropriations, $12,900,000.
B) A credit to Encumbrances, $12,900,000.
C) A debit to Estimated Expenditures, $12,900,000.
D) A credit to Budgetary Fund Balance, $12,900,000.
56) One characteristic that distinguishes other financing sources from revenues is that other
financing sources:
A) Arise from debt issuances or interfund transfers in.
B) Increase fund balances when they are closed at year-end.
C) Provide financial resources for the recipient fund.
D) Have a normal credit balance.
57) The process by which a legal valuation is placed on taxable property is called:
A) An appropriation.
B) A property tax levy.
C) Property assessment.
D) Ad valorem determination.
58) The County Commission of Canyon County adopted its General Fund budget for the year
ending June 30, comprising estimated revenues of $13,200,000 and appropriations of
$12,900,000. The budgeted excess of estimated revenues over appropriations will be recorded as:
A) A credit to Surplus Revenues, $300,000.
B) A debit to Estimated Excess Revenues, $300,000.
C) A credit to Budgetary Fund Balance, $300,000.
D) A memorandum entry only.