Which of the following is not a true statement regarding revenues from various types of nonexchange transactions? Derived tax revenues occur as a result of sales and or income tax. Imposed nonexchange revenues consist of only fines and penalties assessed by the governing agency. Government mandated nonexchange transactions includes grants from the federal government to the local public-school system for a free lunch program. Voluntary nonexchange transactions can originate from a governmental agency or private citizen organization. Imposed nonexchange transactions revenue recognition is made in the time period when the resulting resources are required to be used or in the first period in which use is permitted.

Transaction - An executed contract between a buyer and a seller to trade goods, services, or financial assets in exchange for money is known as a transaction. The phrase is also frequently used in business accounting. This straightforward definition might be challenging in corporate bookkeeping. Depending on whether a corporation utilizes accrual accounting or cash accounting, it may record a transaction sooner or later.Non-exchange transactions cover a wide range of important sources of income and outlay for governmental operations, including taxes (including income, sales, and property taxes) and funds from federal and state aid programs. Using the terms "derived tax revenues," "imposed nonexchange revenues," "government-mandated nonexchange transactions," and "voluntary non-exchange transactions," GASBS 33 specifies four categories of non-exchange transactions. Nonexchange transactions must be recognized in the financial statements on either method of accounting, unless they are not measurable (reasonably estimable) or not likely (likely to occur). The majority of grants and other forms of financial support often go to state and local governments. Grants are non-exchange transactions that can be categorized as obligatory or optional nonexchange transactions. Hence, the correct answer will be Option (B).

Answered: hich of the following is not a true…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Which of the following is not a true statement regarding revenues from various types of nonexchange transactions?

Derived tax revenues occur as a result of sales and or income tax.
Imposed nonexchange revenues consist of only fines and penalties assessed by the governing agency.
Government mandated nonexchange transactions includes grants from the federal government to the local public-school system for a free lunch program.
Voluntary nonexchange transactions can originate from a governmental agency or private citizen organization.
Imposed nonexchange transactions revenue recognition is made in the time period when the resulting resources are required to be used or in the first period in which use is permitted.