Week 61

School: Kennesaw State University - Course: BUSINESS 436 - Subject: Accounting

Week 6 - Activity: Homework Chapters 9 & 10 Chapter 9 Exercise 9-1. EX. 9-1 Select the best answer. What basis of accounting do enterprise and internal service funds use? EnterpriseInternal Service a.Modified accrualModified accrual b.Modified accrualFull accrual c.Full accrualModified accrual d.Full accrualFull accrual Which of the following is not a GASB‐required statement for proprietary funds? a.Statement of net position b.Statement of revenues, expenses, and changes in fund net position c.Statement of cash flows d.Statement of changes in fund net position A government need not necessarily account for an activity in an enterprise fund even though it a.charges fees for the activity and those fees are material in amount. b.finances the activity solely with revenue debt. c.is required by law or policy to recover the cost of the activity by fees. d.opts to establish pricing policies to recover its costs, including capital costs. Tap fees, to the extent that they do not exceed the cost of hooking customers into the utility, should be accounted for as a.capital contributions. b.ordinary revenues. c.a combination of capital contributions and ordinary revenues. d.extraordinary items. Tap fees, a portion of which exceed the cost of hooking customers into the utility, should be accounted for as a.capital contributions. b.ordinary revenues. c.a combination of capital contributions and ordinary revenues. d.extraordinary items. Landfill closure and postclosure costs should be recognized as expenses a.in the periods incurred. b.in the period that the landfill is closed. c.in the periods that the landfill is in operation. d.in the period in which the landfill is opened. Which of the following would not be included in the computation of the amount to be recognized as a landfill closure expense? a.The total estimated closure costs b.The capacity of the landfill c.The proportion of capacity used in prior years d.An appropriate discount rate A city maintains a staff of internal auditors. It may properly account for its internal audit costs in an internal service fund only if a.it is required to do so by state or city statutes or regulations. b.the internal audit activity is carried out in a discrete organizational unit. c.it charges a fee to the city departments for which it provides service. d.a GASB pronouncement specifies that internal audit activity is eligible for internal service fund accounting.