Question: Select the best answer Items 1 through 5 refer to

Select the best answer. Items 1 through 5 refer to Riverview City.
1. Riverview City received a gift of $1 million. The sum is to be maintained as an endowment, with income used to preserve and improve the city's jogging trails.
The $1 million should be reported in
a. A governmental fund
b. An agency fund
c. A fiduciary fund
d. A proprietary fund

2. Riverview City collected $80 million in property taxes on behalf of the Riverview Independent School District. The $80 million should be reported in
a. A governmental fund
b. An agency fund
c. A fiduciary fund
d. A proprietary fund

3. The $80 million collected by Riverview City would be reflected in statements of the appropriate fund as an increase in cash and an offsetting increase in
a. A liability
b. A reserve
c. Fund balance
d. None of the above

4. In the city's government-wide statements the $80 million would be reported as
a. A liability
b. A reserve
c. Net position
d. None of the above

5. The city maintains a $1 million endowment to provide financial assistance to needy retired employees and their families. In its government-wide statements, the $1 million would be reported as an asset in the column for
a. Governmental activities
b. Business-type activities
c. Totals, but not in the column for either govern mental or business-type activities
d. None of the above

6. As of year-end, a city's pension plan had $1.5 million in current obligations to retired employees. The city would report this amount as a liability on
a. The pension trust fund statements only
b. The pension trust fund statements and the government-wide statements
c. The government-wide statements only
d. Neither the pension trust fund statements nor the government-wide statements

7. Depreciation on capital assets would never be reported in which of the following funds?
a. Fiduciary
b. Permanent
c. Internal service
d. Enterprise

8. Which of the following would not be reported on a pension plan's statement of plan net position?
a. Long-term investments at fair value
b. Capital assets used in plan operations at cost less accumulated depreciation
c. Net position held in trust for pension benefits
d. Actuarial accrued liability to current and retired employees

9. A city maintains a $10 million endowment fund to preserve and improve its parks. During the year, the fund had investment gains from the sale of securities of $1 million. These investment gains should be
a. Added to the endowment principal and thereby not be expendable
b. Added to the fund that accounts for dividends and interest and thereby be expendable
c. Either added to the endowment or added to the fund that accounts for dividends and interest, depending on the stipulations of the donor that established the endowment or, absent donor stipulations, on the decision of the endowment's trustees
d. Added to the endowment to the extent necessary to cover losses due to inflation; the balance would be added to the fund that accounts for dividends and interest

10. In a particular year, the Haynes Independent School District collects $100 million in property taxes. State law requires that property-rich school districts appropriate and contribute 2 percent of all property taxes that they collect to a state pool, which will be divided among property-poor districts. Upon receipt of the taxes, the Haynes district, which the state considers a property-rich district, should account for
a. $100 million in an agency fund
b. $98 million in a governmental fund and $2 million in an agency fund
c. $100 million in a governmental fund
d. $98 million in a governmental fund and $2 million in a fiduciary fund other than an agency fund



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  • CreatedAugust 13, 2014
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