Please answer the following regarding Governmental and Non-Profit Accounting:
a. A member of the city commission insists that the city’s internal service fund prepare and submit a budget for commission approval. The commissioner argues that it is only through the budget that the commissioners will be able to ensure control over the internal service fund. Do you agree or disagree with the commissioner’s argument? Explain your answer.
b. Although proprietary funds are often compared to for-profit businesses, there are several differences between accounting for proprietary funds and accounting for a for-profit organization. Identify and discuss several differences for each of the fund financial statements.
c. What are the three components of net position provided by GASB? Describe how a government assigns amounts to the classification?
d. What is the accounting treatment if an internal service fund recovers more or less than the costs incurred by the fund?