Advanced Accounting
14th Edition
ISBN: 9781260247824
Author: Joe Ben Hoyle, Thomas F. Schaefer, Timothy S. Doupnik
Publisher: RENT MCG
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Chapter 17, Problem 29P
To determine
Identify the correct option out of the given statements.
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In the statement of activities,a. all expenses are subtracted from all revenues to get net income.b. the net program expense (revenue) for major functions and programs of the primary government and its component units are presented before general revenues.c. tax revenues designed to benefit the whole government are considered program revenues.d. extraordinary items are those that are either unusual in nature or infrequent in occurrence.
What measurement focus is used in government-wide financial statements, and what system is applied to determine the timing of revenue and expense recognition?
Multiple choice:

The accrual basis of accounting is used to account for revenues and expenditures reported in the financial statements of:
a.
Governmental funds.
b.
Proprietary funds.
c.
Governmental activities at the government-wide level.
d.
Business-type activities at the government-wide level.
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- Select all the true statements from the following pool of statements: A - Tax, being one of the indispensable inherent powers, is the government's primary source of revenue. B - Generally, government revenues arising from exchange transactions are measured at face amount of the cash consideration received. C- For revenues that are long-term and deferred in nature, the revenue is measured at present value. D- Taxes are enforced payments by any taxable subjects, in support of government for its fiscal purpose. Taxes, being comprehensive in nature, may include fines, fees and penalties. E- Generally, payments made to the government in the form of checks are not allowed.arrow_forwardWhich of the following is true regarding government-wide financial statements? a. All capital assets, including infrastructure, are required to be reported. b. Internal service funds are not included. c. Both of the above d. Neither of the abovearrow_forwardWhat is the primary difference between revenue grants and capital grants in accounting for government grants? A. Revenue grants are recognized in the income statement immediately, while capital grants are recognized as deferred income. B. Revenue grants are used for long-term asset acquisition, while capital grants support day-to-day operating activities. C. Both revenue and capital grants are recognized in the income statement immediately. D. Capital grants are not accounted for in financial statements.arrow_forward
- What would be the appropriate account title for funds collected by a sales tax custodial fund? A. Sales tax revenue B. Other financing sources C. Additions-tax collections for other governments D. Sales taxes receivablearrow_forward26. According to the Revised Chart of Accounts issued by COA, the “Subsidy from National Government” account is Asset Account Liability Account Revenue Account Equity Accountarrow_forwardWhich of the following items is not recognized as revenue by a governmental unit? Group of answer choices a.) Sales tax proceeds b.) Bond proceeds c.) Property tax leviesarrow_forward
- 36. Which of the following would result to an increase or decrease in the revenue reported by a government entity in its statement of financial performance? Impairment loss on amount already recognized as revenue Receipt of a pledge Receipt of donation in the form of service in kind The repayment of loan payable is forgivenarrow_forwardWhich of the following government-wide accounts reflects amounts owed between governmental activities and business-type activities? Transfers OOPEB liability None of these Internal balance Interfundarrow_forwardProperty tax revenue recorded in the governmental funds may differ from the amount recorded at the government-wide level in any given year. True or Falsearrow_forward
- A governmental agency can best be described by which of the following statements? A. has a primary purpose of making a profit B. has a primary purpose of using taxpayer funds to provide services C. produces goods for sale to the public D. has regular shareholder meetingsarrow_forwardExplain the modified accrual accounting method. Why is it utilized in financial statements for government funds?arrow_forwardDescribe the different taxes that government uses to collect revenue.arrow_forward
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