1. During the fiscal year ended December 31, 2004, the City of Simonville issued 6% general obligation serial bonds in the amount of $3,000,000 at 101 ($3,060,000) and used $2,970,000 of the proceeds to construct a fire station. The $60,000 premium was transferred to a debt service fund. The $30,000 left in the capital projects fund at the end of the project was transferred to the debt service fund. The bonds were dated April 1, 2004 and paid interest on October 1 and April 1. The first of 10 equal annual principal payments was due on April 1, 2005. The amount of capital outlay expenditures reported by the capital projects fund would be:
A. $3,060,000
B. $3,030,000.
C. $3,000,000.
D. $2,970,000.
2. A government had the following transfers reported in its governmental funds Statement of Revenues, Expenditures, and Changes in Fund Balances: (1) a transfer from the General Fund to a debt service fund in the amount of $l,000,000; (2) a transfer from the General Fund to an enterprise fund in the amount of $1,200,000; and (3) a transfer from the General Fund to an internal service fund in the amount of $400,000. The amount that would be shown as a transfer out in the governmental activities column in the Statement of Activities would be:
A. $2,600,000.
B. $1,400,000.
C. $1,200,000.
D. $ 800,000.
3. During the fiscal year ended December 31, 2004, the City of Simonville issued 6% general obligation serial bonds in the amount of $3,000,000 at 101 and used $2,970,000 of the proceeds to construct a fire station. The premium was transferred to a debt service fund. The $30,000 left in the capital projects fund at the end of the project was transferred to the debt service fund. The bonds were dated May 1, 2004 and paid interest on October 30 and April 30. The first of 10 equal annual principal payments was due on April 1, 2005 What amount would be reported as debt service expenditures in the year ended 2004?
A. $0.
B. $90,000.
C. $180,000.
D. $330,000.
4. During the fiscal year ended December 31, 2004, the City of Simonville issued 6% general obligation serial bonds in the amount of $3,000,000 at 101 and used $2,970,000 of the proceeds to construct a fire station. The premium was transferred to a debt service fund. The $30,000 left in the capital projects fund at the end of the project was transferred to the debt service fund. The bonds were dated April 1, 2004 and paid interest on October 30 and April 30 The first of 10 equal annual principal payments was due on April 1, 2005. How would the construction costs be reported at year-end?
A. As an expenditure of the capital projects fund only.
B. As a capital asset in the Statement of Net Assets only.
C. As an expenditure of the capital projects fund and a capital asset in the government-wide Statement of Net Assets.
D. As an expenditure of the capital projects fund and an expense in the Statement of Activities.
5. The City of X levied property taxes in 2004 in the amount of $10 million. It is estimated that 2% will be uncollectible. During 2004, $9,000,000 was collected, and it is anticipated that $400,000 will be collected during the next 60 days. When moving from the changes in fund balances in the Statement of Revenues, Expenditures, and Changes in Fund Balances to the changes in net assets in the Statement of Activities, what will be the adjustment?
A. An increase of $800,000.
B. An increase of $400,000.
C. An increase of $200,000.
D. Zero.
6. The City of Casperville levied property taxes for 2004 in the amount of $8,000,000. The estimated uncollectibles amounted to 2%. By the end of the year, $7,200,000 had been collected. It was estimated that $400,000 would be collected during the next 60 days of 2005 and that $240,000 would be collected after that. The City has a policy of recognizing the full amount possible for property taxes. Which of the following statements is true?
A. The amount reported for property tax revenue in the government-wide Statement of Activities would be $7,840,000.
B. The amount reported for property tax revenue in the governmental fund Statement of Revenues, Expenditures, and Changes in Fund Balances would be $7,600,000.
C. Both of the above.
D. Neither of the above.
7. Which of the following is true regarding capital projects funds?
A. Capital projects funds are considered to be governmental funds.
B. Capital projects funds use the economic resources measurement focus and accrual basis of accounting.
C. Both of the above are true.
D. Neither of the above is true.
8. Which of the following lease criteria would not qualify a lease as a capital lease?
A. The lease transfers ownership of the property to the lessee by the end of the lease term.
B. The lease contains an option to purchase the leased property at its fair market value.
C. The lease term is equal to or greater than 75% of the estimated economic life of the leased property.
D. The present value of the minimum lease payments equals or exceeds 90% of the fair value of the leased property.
9. Which of the following is true regarding the government-wide financial statements?
A. Government-wide statements include the Statement of Net Assets, the Statement of Activities, and the Statement of Cash Flows.
B. Government-wide statements are prepared using the economic resources measurement focus and accrual basis of accounting.
C. Both of the above are true.
D. Neither of the above is true.
10. The City of X had the following debt outstanding:
Revenue bonds to be paid from utility revenues $5,000,000
General obligation bonds to paid from a debt service fund 2,000,000
General obligation bonds to paid from utility revenues $3,000,000
The amount that should be shown as debt in the utility (enterprise) fund would be:
A. $5,000,000.
B. $7,000,000.
C. $8,000,000.
D. $9,000,000.
11. A governmental funds Statement of Revenues, Expenditures, and Changes in Fund Balances reported expenditures of $30 million, including capital outlay expenditures of $2 million. Capital assets for that government cost $70 million, including land of $10 million. Depreciable assets are amortized over 20 years, on average. The reconciliation from governmental changes in fund balances to governmental activities changes in net assets would reflect a(an):
A. Decrease of $1 million.
B. Increase of $l million.
C. Decrease of $3 million.
D. Increase of $2 million.
12. A government reported expenditures for infrastructure as follows: $20 million for improvements and additions; $18 million to extend the life of existing infrastructure; $16 million for general repairs. The cost of its infrastructure, excluding land, is $750 million, and the infrastructure has an estimated life of 50 years, on average. Which of the following would be the reported expense (in millions) under each of the following options?
A. Depreciation Approach: $53; Modified Approach: $34
B. Depreciation Approach: $49; Modified Approach: $31
C. Depreciation Approach: $31; Modified Approach: $31
D. Depreciation Approach: $31; Modified Approach: $34
13. During the fiscal year ended December 31, 2004, the City of Simonville issued 6% general obligation serial bonds in the amount of $3,000,000 at 101. They used $2,970,000 of the proceeds to construct a fire station. The premium was transferred to a debt service fund. The $30,000 left in the capital projects fund at the end of the project was transferred to the debt service fund. The bonds were dated April 1, 2004 and paid interest on October 30 and April 30. The first of 10 equal annual principal payments was due on April 1, 2005.What would be the amount of debt service expenditures reported in the fiscal year ended 2005?
A. $330,000.
B. $480,000.
C. $321,000.
D. $180,000.
14. Resources and activities related to which of the following fund types is not included in the government-wide financial statements?
A. General Fund
B. Capital Projects Fund
C. Enterprise Fund
D. Pension Trust Fund
15. The General Fund of the City of X made a permanent contribution of $100,000 to an internal service fund in 2004. Also, during the year, the internal service fund had revenues of $500,000, expenses of $450,000, and an transfer out of $30,000. Assuming this was the first year of operations for the internal service fund, the ending net assets balance, after closing entries, would be:
A. $120,000.
B. $100,000.
C. $ 20,000.
D. $ 80,000.