Problem #1 Indicate whether each of the following is a Proprietary (P), or Budget (B) account for
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Question:
Problem #1
Indicate whether each of the following is a Proprietary (P), or Budget (B) account for federal agencies and explain why each would be classified as Proprietary or Budget accounts.
- Accounts payable
- Accumulated depreciation
- Commitments
- Cumulative results of operations
- Disbursements in transit
- Fund balance with treasury
- Office materials and supplies
- Undelivered orders
- Unexpended appropriations
- Other appropriations realized
Problem #3
Congress established the Fruited Plains Lands Preservation Commission (a fictional entity), the main function of which is to encourage farmers, ranchers, and similar types of landowners to take specified conservation measures.
- The Commission is governed by a seven-person board, the members of which are appointed by the President, subject to the approval of Congress. The Commission is funded through the normal appropriation process. Should the Commission be considered a federal reporting entity, and if so, should it be a "consolidation" entity or merely a "disclosure" entity?
- The entity maintains both budget accounts and proprietary accounts. What is the distinction between the two types of accounts?
- In a recent year, the Commission received appropriations of $110 million but spent only $90 million. Assuming the appropriation does not lapse, how would the unspent $20 million be reported on the Commission's year-end balance sheet?
- To educate the public on the importance of wildlife preservation, the Commission received a legally binding pledge of $2.5 million from a private foundation. Of this amount, only $800,000 was received during the year. The balance is expected to be received in the following year. How much of the pledge should be recognized as revenue in the year it is made?
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