Question 1: When supplies ordered by a governmental unit are received at an actual price which is more than the estimated price on the purchase order, the Encumbrance Control account is:
A. debited for the estimated price on the purchase order
B. credited for the actual price on the purchase order
C. credited for the original estimated price for the supplies received
D. debited for the actual price for the supplies received
Question 2: What is the effect on the General Funds’ unreserved fund balance when capital assets are purchased during a year from General Fund revenues?
A. There is no effect, since one asset (cash) is replaced by another (capital asset)
B. Unreserved fund balance is decreased
C. Unreserved fund balance is increased
D. None of the above, capital assets must be purchased through a capital projects fund
Question 3: The City of Lonesome Pines levied property taxes for the fiscal year ended June 30, 2009 in the amount of $8,000,000. It is estimated that 2% will not be collected. During the year ended June 30, 2009, $7,200,000 in property taxes were collected. It is estimated that $400,000 will be collected during the next 60 days, $240,000 will be collected after 60 days and $160,000 will not be collected. What is the maximum amount Lonesome Pines can recognize as property tax revenue for the fiscal year ended June 30, 2009 in its Governmental Funds Statement of Revenues, Expenditures and Changes in Fund Balances, assuming there were no unpaid property taxes at the end of the previous year?
A. $7,840,000
B. $7,600,000
C. $7,200,000
D. $8,000,000
Question 4: Expenditures are generally recorded and fund liabilities are recognized:
A. when purchase orders are issued, regardless of whether resources are available in the fund
B. when goods and services are received, regardless of whether or not resources are available in the fund
C. when goods and services are received, but only if resources are available in the fund
D. when invoices are paid
Question 5: When payrolls and other liabilities are incurred and must be paid before substantial amounts of cash will be collected, what type of short-term note is desirable and secured by a government's power to tax?
A. Tax Anticipation Note Payable
B. Tax Budget Note Payable
C. Tax Relief Note Payable
D. Tax Encumbrances Note Payable
Question 6: Property Taxes, special assessments and fines and forfeits are types of nonexchange transactions and assets should be recognized when an enforceable legal claim exists or when the resources are received, which ever is first. These are examples of:
A. deferred tax revenues
B. imposed nonexchange transactions
C. government-mandated nonexchange transactions
D. voluntary nonexchange transactions