ACC 410 WEEK 6 QUIZ 4
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TRUE/FALSE (CHAPTER 9)
- In both the fund statements and the government-wide statements, business-type activities and internal service funds are on a full accrual basis, and their measurement focus is on all economic resources.
- The operating statement required as one of the three basic financial statements for proprietary funds is called the statement of revenues, expenditures, and changes in net position.
- The amounts reported in proprietary fund statements are generally the same as those reported in the government-wide statements because both sets of statements are on a full accrual basis of accounting.
- Governments are required to prepare a statement of cash flows for proprietary funds, but not for governmental funds.
- GASB Statement No. 34 mandates that governments report their cash flows from operations using the indirect method.
- The FASB mandates that entities report their cash flows from operations using the direct method.
- Governments generally do not have to get formal legislative approval for enterprise fund budgets or incorporate them into their accounting systems.
- In accounting for closure and postclosure landfill costs in an enterprise fund, a government does not necessarily have to “fund” the costs during the landfill’s useful life; it merely has to report both an expense and a liability for them.
- The revenues of an internal service fund are the expenditures and expenses of other funds of that government.
- The proprietary fund operating statement includes ALL changes in net position including capital contributions.
- Governments must account for an activity in an enterprise fund only if local laws specifically require use of an enterprise fund.
- Governments are not required to incorporate proprietary fund budgets into the accounting system.
- GASB standards require that governments advance fund landfill closure and postclosure costs on an actuarial basis similar to the advance funding of pension plans.
- The costs of cleaning up toxic substances seeping out from an abandoned county dump into the town water supply may be accounted for in either a governmental fund or an enterprise fund.
- Internal service funds should be consolidated with other governmental funds in the government-wide statements.