Many accountants note that for most governments the reported ‘‘bottom line’’ of their ﬁnancial statements (i.e., revenues less expenditures/expenses and other charges that affect fund balance/net position) will not greatly differ between their fund statements and their government-wide statements insofar as the expenditures/expenses relate to long-term assets and the long-term liabilities issued to ﬁnance those assets. That’s because governments typically repay the debt evenly over a period which approximates the economic life of the related asset. Assuming the accountant’s assumption as to means of ﬁnancing to be correct, will the expenditures and related charges affecting fund balance of the governmental fund statements approximate the expenses of the government-wide statements?
Answer to relevant QuestionsGovernments are not required to accrue interest on long-term debt in governmental funds even if the interest is applicable to a current period and will be due the ﬁrst day of the following year. Explain and justify the ...Assume that Nolanville’s ﬁscal year ends on December 31.1. Nolanville’s payroll for one of its departments is $15,000 per week. It pays its employees on the Thursday of the week following that in which the wages and ...Lemon County permits employees to accumulate any sick leave that they do not take. If employees do not use accumulated sick leave, then they will be paid for those days upon retirement or termination (up to a maximum of 45 ...The Mainor School District is about to establish a 30-machine computer lab. It is considering six alternative means of acquiring and ﬁnancing the machines:1. Buy the machines outright; cost will be $60,000.2. Buy the ...A city acquires $1 million of public safety emergency communication equipment by entering into a capital lease. The city divides its ﬁrst rent payment of $ 135,868 between lease interest and lease principal as ...
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