Question 13 Which of the following is NOT a reason that legally adopted budgets may not be readily comparable to amounts reported in the GAAP-based financial statements? Differences in Basis of Accounting. Differences in Timing. Differences in Reporting Entity. Differences in Recognition.
Multiple choices
Question 13
Which of the following is NOT a reason that legally adopted budgets may not be readily comparable to amounts reported in the GAAP-based financial statements?
- Differences in Basis of Accounting.
- Differences in Timing.
- Differences in Reporting Entity.
- Differences in Recognition.
Question 14
Which of the following is the best reason for preparing budgets for governmental entities on the cash basis?
Cash basis budgeting helps to achieve interperiod equity.- Cash basis budgeting helps to ensure that the government will receive no more in revenues than it is required to disburse.
- Cash basis budgeting helps a government plan to have cash on hand to pay bills
- Cash basis budgeting more accurately reflects the economic impact of fiscal activities.
Question 15
Why would a government be more likely than a not-for-profit organization to integrate its budget into its accounting system?
- Because the amount of expenditures are likely to be greater.
- Because the penalties for exceeding budgeted expenditures are more severe.
- Because governments have more sophisticated accounting systems than not-for-profit organizations.
- Governments are NOT more likely than not-for-profits to formally integrate their budget into their accounting system.
Question 16
For which of the following funds would flexible budgeting be most valuable?
- Special revenue fund.
- Capital project fund.
- Agency fund.
- Enterprise fund.
Question 17
The City of Lakeview adopts its budget on a basis of accounting that permits outstanding purchase commitments to be charged against the budget in the year that the goods are ordered instead of in the year they are received. During the year the City ordered and received $4,000 of supplies (of which $3,000 had been paid and $1,000 was unpaid) and had $500 of outstanding purchase commitments for supplies at year-end. In the Statement of Budget to Actual, the expenditures for supplies would be:
|
a. $3,000.00 |
||
|
b. $3,500.00 |
||
|
c. $4,000.00 |
||
|
d. $4,500.00 |
Question 18
Which of the following is a primary benefit of a performance budget?
- It facilitates control by establishing rigid spending mandates.
- It encourages accomplishment of objectives by associating expenditures with outcomes.
- It encourages planning by requiring management to anticipate every type of expenditure.
- It provides decision-makers with detailed information.
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
