2. PART I: MULTIPLE CHOICE AND TRUE/FALSE QUESSTIONS (30 POINTS) T, F. Budgets, budget- variances and comparisons are essential for capital project funds T,F. When bonds are issued for capital projects, premiums are generally not accounted for as the mirror image of discounts on bonds Which of the following is likely to be shown on the balance sheet of the debt service fund? a. Bonds Payable b. Investment (at fair value) c. Cash d. Special assessment receivable e. None of the above. T, F. Arbitrage is a legal means that governments use in issuing low interest rate bonds and the funds generated to invest in high-risk and high-interest generating investments. Unlike other financing methods for capital projects, special assessments: a. Are subject to abuse b. Are not always advantageous to citizens c. Are indirect taxes to citizens d. All of the above e. Only b and c above 1. 2. 3. 4. S. 6. T, F. Most governments record pension costs on expenditure basis rather on economic ba 7. T,F. Government-wide financial statements should report all claims and judgments on an 8. T, F. Government-wide financial statements are reported on a modified or full accrual ba 9. Other financing Sources refer to these items EXCEPT that reflects the total cost of present and future requirements of Pension Fund. basis accounting Proceeds from long-term debt Proceeds from sale of property of government Levy on citizens a. b. C. d. e. 10. T, Non-reciprocal transfers None of the above F. A capital lease is the equivalent of a purchase and borrowing transaction. reported in: 11. In government-wide statement of activities, program-specific activities are a. Charge for services b. Program-specific operating grants and contributions c. Program-specific capital grants d. All of the above e. Only b and above. 12. T, F. Because the modified accrual statements focus on expendable financial resources revenues must be available to pay for liabilities before they can be recognized