35) The City of Pringle purchased a vehicle for the police department. If the operations of the
police department are financed by general revenues, an asset would be recorded in which
journal(s)?
General Fund
Governmental
Activities
A)
Yes
No
B)
No
No
C)
No
Yes
D)
Yes
Yes
A) Choice A.
B) Choice B.
C) Choice C.
D) Choice D.
36) The Town of Loveland levied property taxes in the amount of $1,600,000. The town estimates
that 1 percent will be uncollectible. The journal entry to record the tax levy will include
A) A debit to Cash for $1,584,000.
B) A credit to Revenues for $1,584,000.
C) A debit to Allowance for Uncollectible Current Taxes for $16,000.
D) A debit to Estimated Revenues for $1,600,000.
37) Dover City has calculated that General Fund property tax revenues of $5,640,000 are required
for the current fiscal year. Over the past several years, the city has collected 94 percent of all
property taxes levied. The city levied property taxes in the amount that will generate the required
$5,640,000. Which of the following general journal entries would correctly record the property tax
levy?
A)
General Journal
Debit
Credit
Taxes Receivable—Current
5,640,000
Estimated Uncollectible Current Taxes
338,400
Revenues
5,301,600
B)
General Journal
Debit
Credit
Taxes Receivable—Current
6,000,000
Estimated Uncollectible Current Taxes
360,000
Revenues
5,640,000
C)
General Journal
Debit
Credit
Taxes Receivable—Current
5,640,000
Deferred Inflows of Taxes
338,400
Revenues
5,301,600
D)
General Journal
Debit
Credit
Taxes Receivable—Current
6,000,000
Deferred Inflows of Taxes
360,000
Revenues
5,640,000
38) An interfund transfer in should be reported in a governmental fund operating statement as
a(an):
A) Revenue.
B) Due from other funds.
C) Other financing source.
D) Other financing use.
39) The General Fund has transferred cash to the appropriate fund for eventual retirement of term
bonds maturing in 10 years. Which funds would record this transaction?
General Fund
Debt Service Fund
A)
Yes
Yes
B)
No
Yes
C)
Yes
No
D)
Yes
Yes
A) Choice A.
B) Choice B.
C) Choice C.
D) Choice D.
40) A properly prepared schedule of revenues, expenditures, and changes in fund
balances—budget and actual will include which of the following columns?
A) Actual revenue and expenditure amounts on the GAAP basis.
B) Actual revenue and expenditure amounts on the budget basis.
C) Encumbrances outstanding at year-end.
D) Unexpended appropriations.
41) Using the information below, what amount should be accounted for in a special revenue fund
or funds?
Warehouse equipment used to store supplies for delivery to all city
departments and agencies on a cost-reimbursement basis
$
300,000
Equipment used for supplying electric power to residents
$
1,750,000
Receivables for completed sidewalks to be paid for in installments by
affected property owners. Construction was financed by special
assessment bonds for which the town has no liability
$
1,500,000
Cash received from federal government, dedicated to highway
maintenance
$
1,800,000
A) $1,800,000.
B) $2,100,000.
C) $3,300,000.
D) $5,350,000.
42) Which of the following would properly be reported in the operating statement of a
governmental fund?
A) Interest on a tax anticipation note issued and repaid during the period.
B) Amortization expense.
C) Depreciation expense.
D) A grant that is intended to finance activities of the following period.
43) The Revenues account of a government is debited when:
A) The budget is recorded at the beginning of the year.
B) Property taxes are recorded.
C) The account is closed to fund balance—unassigned at the end of the year.
D) Property taxes are collected.
44) The Estimated Revenues account of a government is debited when:
A) The budget is recorded at the beginning of the year.
B) Property taxes are recorded.
C) The account is closed to fund balance—unassigned at the end of the year.
D) Property taxes are collected.
45) Which of the following would be considered an internal exchange transaction?
A) The General Fund transfers $200,000 to establish a Central Supplies Fund; this amount will not
be repaid.
B) The General Fund transfers $125,000 to the Debt Service Fund for payment of currently due
bond interest payments.
C) The General Fund transfers $9,000 to the Central Supplies Fund for supplies it received from
Central Supplies.
D) The Capital Projects Fund completes a library building project and transfers the remaining cash
to the Debt Service Fund.
46) The General Fund used electricity provided by the city-owned electric utility (an enterprise
fund of the city). The General Fund general journal entry to record the transaction will include:
A) A debit to Expenses.
B) A debit to Expenditures.
C) A debit to Interfund Transfers Out.
D) A debit to Due to Other Funds.
47) The General Fund used electricity provided by the city-owned electric utility (an enterprise
fund of the city). The governmental activities journal entry to record the transaction will include:
A) A debit to Expenses.
B) A debit to Expenditures.
C) A debit to Internal Balances.
D) No entry would be recorded since the transaction is between two funds of the same
government.
48) On May 1, the City of Dustin was notified of approval of a $300,000 federal operating grant,
payable on a reimbursement basis as the city expends resources for the intended purpose of the
grant. As of May 1, no expenditures had been made for grant purposes. The journal entry to record
approval of this grant will include:
A) A credit to Revenues in the amount of $300,000.
B) A credit to Deferred Inflows of Resources—Grant Proceeds in the amount of $300,000.
C) A debit to Grants Receivable in the amount of $300,000.
D) No journal entry will be made until expenditures for the authorized purpose occur.
49) Vacation City was awarded a $500,000 federal operating grant for use in year 2. On December
1 of year 1, half of the grant money was received by the City. The journal entry to record receipt of
the grant funds will include:
A) A credit to Revenues in the amount of $250,000.
B) A credit to Deferred Inflows of Resources—Grant Proceeds in the amount of $250,000.
C) A debit to Grant Expenditures in the amount of $250,000.
D) No journal entry will be made until expenditures are made in Year 2.
50) Which of the following best describes the proper treatment for uncollectible amounts of taxes?
A) Report as bad debt expense.
B) Report as deferred inflows of resources.
C) Report as bad debt expenditures.
D) Report receivables net of uncollectible amounts.
51) Property taxes due and collectible 90 days after the 2020 fiscal year end would be recorded as
revenues in 2020 in which journal?
General Fund
Governmental Activities
A)
Yes
No
B)
No
No
C)
No
Yes
D)
Yes
Yes
A) Choice A.
B) Choice B.
C) Choice C.
D) Choice D.
52) Cartier Village’s capital expenditures during the year ended December 31 included:
Equipment for village tax collector’s office
$
40,000
Police vehicles
60,000
What amounts should have been recorded in the General Fund and the governmental activities
journal for the increase in the equipment account during the year ended December 31?
A) General Fund: $0; Governmental activities: $0
B) General Fund: $0; Governmental activities: $100,000
C) General Fund: $40,000; Governmental activities: $60,000
D) General Fund: $100,000; Governmental activities: $0
53) The City of Island Grove uses encumbrance accounting and its fiscal year ends on June 30. On
May 6, a purchase order was approved and issued for supplies in the amount of $6,000. Island
Grove received these supplies on June 2, and the $6,000 invoice was approved for payment. What
General Fund journal entry should Island Grove make on May 6, to record the approved purchase
order?
Transaction
General Journal
Debits
Credits
A)
Encumbrances
6,000
Appropriations
6,000
B)
Supplies
6,000
Vouchers Payable
6,000
C)
Encumbrances
6,000
Encumbrances Outstanding
6,000
D)
Expenditures
6,000
Encumbrances
6,000
A) Choice A
B) Choice B
C) Choice C
D) Choice D