Multiple Choice Questions
Identify the best answer for each of the following:
1. Formal notification that Congress has enacted an appropriation for an agency requires recognition by the agency in
a. Budgetary accounts only.
b. Proprietary accounts only.
c. Both budgetary and proprietary accounts.
d. Neither budgetary nor proprietary accounts. (No entry is required until apportionments are made.)

2. Primary responsibility for accounting for agency resources and expended appropriations rests with
a. Each individual agency.
b. The Department of the Treasury.
c. The Government Accountability Office.
d. The Office of Management and Budget.
e. The Federal Accounting Standards Advisory Board.

3. A federal agency’s accounting system does not need to include information pertaining to
a. Expended appropriations.
b. Fixed assets.
c. Obligations.
d. Expenses.
e. All of the above must be included.

4. In 20X5, the U.S. Weather Service purchased a parcel of land near Verlene, California, with $850,000 of appropriated funds, with the intention of constructing a facility there. The effect of this transaction on Cumulative Results of Operations is
a. No change.
b. To increase it by $850,000.
c. No change, but Unexpended Appropriations would decrease by $850,000.
d. None of the above.

5. An appropriation that has expired
a. Is reported by a federal agency as unapportioned authority.
b. Is reported by a federal agency as unexpended appropriations.
c. Is reported by a federal agency as unobligated allotments.
d. Is not reported by a federal agency in any of its net position accounts.

6. Direct labor costs incurred by a federal agency during a period will be reflected in the agency’s budgetary accounts as
a. A debit to Expended Appropriations and credit to Cash.
b. A debit to Expended Appropriations and credit to Cumulative Results of Operations.
c. A debit to Allotments—Realized Resources and credit to Expended Appropriations.
d. A debit to Undelivered Orders and credit to Expended Appropriations.

7. On June 1, 20X7, the Department of Labor ordered $10,000 worth of stationery and office supplies from an authorized contractor. At the time of the purchase order, this transaction should be recorded by the agency as
a. A $10,000 debit to current assets and a $10,000 credit to liabilities.
b. A $10,000 debit to Commitments and a $10,000 credit to Undelivered Orders—Unpaid.
c. A $10,000 debit to Expended Appropriations and a $10,000 credit to Cumulative Results of Operations.
d. A $10,000 debit to Allotments—Realized Resources and a $10,000 credit to Expended Appropriations.
e. A $10,000 debit to Unapportioned Authority and a $10,000 credit to Expended Appropriations.

8. Unapportioned Authority is reclassified as Apportionments when
a. the Office of Management and Budget releases enacted appropriations to the federal agency.
b. The appropriate agency officials assign appropriations to various departments within the agency.
c. Purchase orders are approved and sent to suppliers of goods.
d. Suppliers are paid for goods furnished to an agency.
e. Assets are returned by a federal agency to the Treasury.

9. Six proprietary financial statements have been identified for use by a federal agency. These statements are required to be prepared and presented for
a. Government-wide financial reporting, but not for federal agency reporting.
b. Both federal agency and for government-wide reporting.
c. Each federal agency, but only some are required for government-wide reporting.
d. None of the above.

10. Which of the following financial statements is not required to be reported on a government-wide basis?
a. Balance Sheet
b. Statement of Net Cost
c. Statement of Changes in Net Position
d. All of the above are required.