Governmental and Nonprofit Accounting (11th Edition)
11th Edition
ISBN: 9780133799569
Author: Robert J. Freeman, Craig D. Shoulders, Dwayne N. McSwain, Robert B. Scott
Publisher: PEARSON
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Question
Chapter 7, Problem 2.2E
To determine
Indicate the correct statement:
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Which of the following is true regarding capital projects funds?
Multiple Choice
Encumbrances accounting is generally employed.
All budgetary accounts are employed and budget to actual statements are prepared.
No budgetary accounts are used.
Encumbrances accounting is not normally employed, but Appropriations are recorded.
When a government orders equipment which is to be used by an activity accounted within the General Fund, it should be recorded in the General Fund as a(an):
Multiple Choice
Encumbrance.
Capital asset.
Expenditure.
None of the choices are correct, the General Fund does not record capital assets purchases..
Use the following information to determine whether the Development Special Revenue and the Debt Service Funds should be reported as major funds based on asset amounts
provided.
Various Assets and Amounts
Asset Type
Development Special Revenue Fund Assets
Debt Service Fund Assets
Total Governmental Fund Assets
Total Governmental Fund and Enterprise Fund Assets
Both the Development Special Revenue Fund and the Debt Service Fund should be reported as major.
Neither the Development Special Revenue Fund nor the Debt Service Fund should be reported as major.
The Development Special Revenue Fund should be reported as major.
The Debt Service Fund should be reported as major.
Asset Amount
$ 740,000
$ 150,000
$ 7,500,000
$8,750,000
Chapter 7 Solutions
Governmental and Nonprofit Accounting (11th Edition)
Ch. 7 - When is a Capital Projects Fund used by a...Ch. 7 - Prob. 2QCh. 7 - What is the life cycle of a Capital Projects Fund?Ch. 7 - Why is each significant capital project usually...Ch. 7 - In what situations could several capital projects...Ch. 7 - Prob. 6QCh. 7 - Prob. 7QCh. 7 - Prob. 8QCh. 7 - Prob. 9QCh. 7 - Prob. 10Q
Ch. 7 - Prob. 11QCh. 7 - Prob. 12QCh. 7 - Which of the following general government capital...Ch. 7 - Budgets for Capital Projects Funds are a. often...Ch. 7 - Which of the following are sometimes reported as...Ch. 7 - Wakefield Heights sold 6,000,000 of general...Ch. 7 - Which of the following statements regarding the...Ch. 7 - Common expenditures in a Capital Projects Fund...Ch. 7 - Prob. 1.7ECh. 7 - In practice, which of the following is false...Ch. 7 - The funding sources for a Capital Projects Fund...Ch. 7 - Prob. 2.2ECh. 7 - When grant resources are received before...Ch. 7 - Bonds are sold to finance the construction of a...Ch. 7 - After restricted and committed levels of fund...Ch. 7 - Which of the following would not be reported on...Ch. 7 - The City of Hope received an unrestricted grant in...Ch. 7 - Expenditures are made in a Capital Projects Fund...Ch. 7 - A GAAP-based Statement of Revenues, Expenditures,...Ch. 7 - Prob. 2.10ECh. 7 - (General Ledger Entries) The following...Ch. 7 - (Long-Term Debt Issuances) Swenson Township issued...Ch. 7 - (Short Discussion and Analysis) Briefly discuss...Ch. 7 - (Statement of Revenues, Expenditures, and Changes...Ch. 7 - (Multiple Choice Problems and Computations)...Ch. 7 - Prob. 2PCh. 7 - (Statement of Revenues, Expenditures, and Changes...Ch. 7 - Prob. 6PCh. 7 - (CPF Journal EntriesBlue Earth County, Montana)...
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Similar questions
- Which of the following statements is true? O a. The principal of permanent funds are classified as Nonspendable Fund Balance O b. The fund balance of permanent funds should be classified as Nonspendatie, Spendatie, and Cammited Net Poston O. Any governmental fund may have an Unassigned Fund Balance. O d. Fund balances of debt service funds are classified as Restricted and Unrestrictedarrow_forwardIf an internal service fund is intended to operate on a cost-reimbursement basis, then user charges should a. cover the full costs, both direct and indirect, of operating the fund. b. cover the full costs of operating the fund and provide for future expansion and replacement of capital assets. c. cover at a minimum the direct costs of operating the fund. d. do all of the above.arrow_forwardWhich of the following is incorrect with respect to fund balances? Multiple Choice Restricted fund balance are net resources of a government fund that are subject to constraints imposed by external parties or by law. Assigned fund balances are resources that the governing body has specified for a particular use through ordinance or resolution by the government’s highest level of authority. Only unassigned fund balances may have a negative balance. Inventory and prepaid items are classified as nonspendable fund balances..arrow_forward
- Which of the following statements is correct? The General Fund, Special Revenue, and Debt Service funds use the modified accrual basis and financial resources focus and the Capital Projects and Permanent funds do not. The General Fund and Special Revenue fund provide budget to actual comparisons and the Capital Projects, Debt Service and Permanent Funds do not. The General Fund and Special Revenue Fund have an indefinite life and the Permanent, Capital Projects and Debt Service have limited lives. The General Fund and Special Revenue funds use encumbrance accounting and the Capital Projects, Debt Service and Permanent funds do not.arrow_forward8 Which of the following items would not appear in a statement of revenues, expenditures, and changes in fund balances prepared for a governmental fund? Multiple Choice Depreciation expense. Interfund transfers in. Revenues from property taxes. Expenditures for employee salaries.arrow_forwardWhich of the following funds of a governmental unit recognizes revenues in the accounting period only when they are both available and measurable? General Fund Enterprise Fund a. Yes No b. No Yes c. Yes Yes d. No Noarrow_forward
- What type of the fund is alloted to capital project?Select one:a. Special revenue fundb. Government fundc. General fundd. None of the other pointsarrow_forwardFor each of the following accounts indicate in which fund type it could be found. Select your answer from the following responses: A. Governmental funds only. B. Proprietary funds only. Bond Proceeds Long Term liability for Compensated Absences Deferred Inflows/Outflows of Resources Taxes Receivable Estimated Revenues Operating Revenuesarrow_forwardAn internal service fund normally uses which of the following budgetary accounts? Multiple Choice Encumbrances. Estimated Revenues. Appropriations. An internal service fund normally does not use budgetary accounts.arrow_forward
- Prepare a Balance Sheet for the governemental Funds assumiong all unexpended spendable net resources in the capital projects fund are classified as restricted and in the debt service fund are classified as assigned.arrow_forwardFiduciary activities should be reported in fund statements, but should be excluded from the government-wide statements. a. True b. Falsearrow_forwardDonor-restricted contributions that have been given to a VHWO for the purpose of purchasing fixed assets should be recorded as increases toa. Unrestricted Net Assets.b. Temporarily Restricted Net Assets.c. Permanently Restricted Net Assets.d. Fund Balance—Restricted.arrow_forward
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