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Study Resources (Accounting)

True / False Questions 40.Political parties and campaign committees can qualify for tax-exempt status.  41.All not-for-profit organizations are required to file some type of Form 990 with the Internal Revenue Service.  42.The Internal Revenue Service requires that information from the audited financial statements be used to complete the Form 990.  Multiple.
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57.Why should persons who manage, advise, or audit governments and not-for-profit organizations be generally familiar with OMB Circulars A-87, A-21, and A-122? In your answer explain what "OMB" means, and why its circulars should be of concern to those involved with management, advisement, or auditing of state and local governments.
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Multiple Choice Questions 17.Which of the following is a primary objective of financial reporting by state and local governments?  A. To provide information that can be used for capital allocation decisions made by external investors. B. To report on the legal requirements imposed on the government by its elected officials. C..
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11.Total quality management (TQM) seeks to continuously improve an organization's ability to meet or exceed customers' demands, and, as such, is useful in a government setting as well as a business setting.  12.Service efforts and accomplishments measures suffer from the same problem as line-item or object-of-expenditures budgeting; that is, focusing.
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Multiple Choice Questions 23.Which of the following statements is not consistent with the GASB's "Budgeting, Budgetary Control, and Budgetary Reporting Principle?" A. An annual budget must be adopted using generally accepted accounting principles. B. The accounting system should provide the basis for appropriate budgetary control. C. Budgetary comparison schedules should be presented as.
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27.A measure of whether the government lived within its means in the measurement year, or was required to use prior year resources to fund a portion of current year costs, or shifted the funding of some current year costs to future periods, is  A. Business-type activities revenues/business-type activities expenses. B..
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Essay Questions 43.Prepare in general journal form the entries required for each of the following selected transactions of Northern University, a state-funded public institution engaged only in business-type activities. Some of these transactions are related and some are not. 44.Manthei University, a private university, has provided the following information concerning selected transactions..
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27.One of the purposes of the Federal Financial Management Improvement Act of 1996 was to  A. Establish a requirement that the financial statements of the federal government as a whole be audited. B. Improve the effectiveness of programs receiving federal funds. C. Establish generally accepted federal accounting principles. D. Rebuild.
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Essay Questions 46.Record in general journal form the following selected transactions for Avalon General Hospital, a nongovernmental not-for-profit institution. 47.Show entries in general journal form for the following transactions of Bothwell Regional Hospital, a nongovernmental not-for-profit hospital. 48.Georgetown Hospital, a governmental hospital, recorded during its fiscal year ended September 30, gross patient services.
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True / False Questions 1.GASB Concepts Statement 4 identifies expenditures as a financial statement element.  2.According to the guidance of GASB Concepts Statement 3, financial information can be communicated by recognition in the financial statements, disclosure in the notes to the financial statements, presentation as required supplementary information, or presentation as.
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27.What constitutes the basic financial statements of a government?  A. Financial section of the comprehensive annual financial report (CAFR). B. Government-wide financial statements plus notes. C. Government-wide financial statements plus fund financial statements plus notes. D. Government-wide financial statements plus fund financial statements plus notes plus required supplementary information (RSI)..
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28.A condition whereby the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements on a timely basis is called a(an)  A. Deficiency. B. System design weakness. C. Unacceptable reportable condition. D..
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Multiple Choice Questions 15.Which of the following statements is true regarding generally accepted accounting principles (GAAP) for colleges and universities? A. The FASB has set standards for private and public colleges and universities from the time of its inception in 1974. B. The National Association of Colleges and University Business Officers (NACUBO) provides.
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11.A nongovernmental not-for-profit health care entity would report the net asset categories unrestricted, restricted and permanently restricted.   12.Continuing care retirement communities (CCRC) provide residential care in a facility, along with some level of long-term medical care that is less intensive than hospital care.  13.All health care organizations report investments at.
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Multiple Choice Questions 17.Which of the following is a not a true statement about tax-exempt organizations?  A. They must be organized to serve the charitable needs of the public at large. B. They must first become a not-for-profit corporation or charitable trust. C. They are permitted to do some political lobbying.
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Essay Questions 46.The Desert Conservation Agency was authorized by the United States Congress to commence operations on October 1, 2014. Record the following transactions in general journal form, as they should appear in the budgetary and proprietary accounts of the agency. For each entry indicate whether it affects the budgetary accounts.
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True / False Questions 1.Financial reporting standards for all hospitals are established by the FASB.  2.Patient service revenues and related receivables exclude charges for charity care services.  3.In accounting for health care entities, the provision for bad debt should always be recorded as a revenue deduction, rather than as an expense. .
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True / False Questions 1.Nongovernmental (private) colleges and universities should follow FASB standards; governmental (public) colleges and universities should follow GASB standards. 2.Under GASB standards, public colleges and universities are considered general purpose governments. 3.Revenues and expenses of both public business-type and private colleges and universities are accounted for on the accrual basis. 4.A.
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11.Fiduciary activities are not reported in the government-wide financial statements under GASB standards.  12.Other comprehensive bases of accounting (OCBOA) are considered generally accepted accounting principles (GAAP) for state and local governments.  13.In converting from the modified accrual basis of accounting information in a governmental fund to accrual basis for the.
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Multiple Choice Questions 21.According to FASB standards, which of the following entities would not be considered a health care organization? A. The Heart Research Institute. B. The St. George Hospital. C. The Family Practice Medical Clinic. D. The Northeast Health Maintenance Organization. 22.Which of the following is (are) considered an authoritative.
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11.Not-for-profit organizations risk loss of their tax-exempt status if they engage in any political activity.  12."Excess benefit transactions" are those in which persons who have substantial influence over the not-for-profit organization engage in transactions that result in economic benefits to them that are excessive, such as unreasonable compensation, sale of.
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Multiple Choice Questions 25.Each of the following are reported as fiduciary funds except  A. A permanent fund. B. An investment trust fund. C. An agency fund. D. A private-purpose trust fund. 26.Which of the following is not a fiduciary fund?  A. Agency fund. B. Investment trust fund. C. Public-purpose trust fund. D. Pension.
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27.A good measure of whether a not-for-profit organization is spending too much on overhead, such as general and administrative expenses, is  A. Percentage of unrestricted net assets to operating expenses. B. Current ratio. C. Total revenues divided by total expenses. D. Percentage of total expenses spent on the program function.
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True / False Questions 1.Resources that are held in trust for the benefit of the government’s own programs or its citizenry should be accounted for using a governmental fund rather than a fiduciary fund.  2.Trust funds often exist over a longer period of time than agency funds, represent and develop vested.
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25.Which of the following is required as part of a complete set of financial statements for a private college or university? A. Statement of changes in operations. B. Statement of revenues, expenses, and changes in net assets. C. Statement of activities. D. Statement of functional expenses. 26.Colleges and universities often make loans to students. How.
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33.Effective capital budgeting for general capital assets of a government requires A. Intermediate and long-range capital improvement plans for general capital assets. B. Nonfinancial information on physical measures and service condition of capital assets of component units. C. Consideration of how proprietary fund capital projects will be financed. D. Information about the capital.
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53.Explain what is required to develop an effective total quality management (TQM) program for a government. 54.How can service efforts and accomplishments (SEA) indicators be useful in improving budgeting? 56.What is the role of cost drivers in an activity-based cost (ABC) system? Explain how analysis of cost drivers can be.
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True / False Questions 1.Some of the budgeting approaches governments have experimented with as alternatives to line-item, incremental budgeting include performance budgeting, program budgeting, the planning-programming-budgeting system, and zero-based budgeting.  2.In governments, the budget has always played a role in external financial reports through the required budget-to-actual comparison schedules or statements.
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45.Which of the following is the appropriate basis of accounting for an agency fund?  A. Cash basis. B. Modified cash basis. C. Accrual basis. D. Modified accrual basis. 46.A donor contributed $100,000 to the city stipulating that the money be invested and that the earnings thereon be used for maintenance.
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11.In auditing compliance with laws and regulations as part of a single audit, the auditor must render an opinion on the specific requirements applicable to each program for which the entity receives federal financial assistance.  12.Though used historically by corporate boards of directors, audit committees have great potential in a.
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TRUE/FALSE QUESTIONS . 1.A system is a collection of resources related such that certain objectives can be achieved. 2.Accounting information systems are designed to gather and utilize information which may cost more to provide than it is worth to the user. 3.Examples of the information provided by a financial information system are cash flow.
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True / False Questions 1.Audits of governments' financial statements are performed to determine if the financial statements are correct and in accordance with generally accepted accounting principles, but not to determine if there is compliance with laws and regulations.  2.The introductory paragraph of an audit report introduces the auditor and his/her.
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FILL-IN-THE-BLANK QUESTIONS 31.A systems development project consists of __________ general phases. 32.The purpose of the __________ approach is to assist in the orderly development of effective systems. 33.Many companies prefer business process __________ because they find it more cost-effective than designing their own system from the ground up. 34.A philosophy of ___________ design fosters.
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True / False Questions 1.An effective system of monitoring financial condition may permit management to identify unfavorable financial trends in sufficient time to take preventive action to avoid financial distress.  2.A tax watchdog group is an example of an intermediary that represents citizen interests.  3.The key cause of municipal financial crises.
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Multiple Choice Questions 16.Which of the following is not a typical reason why people evaluate a government's financial condition?  A. Prevent financial crises from developing. B. Hold management accountable for the use of tax revenues. C. Determine if the government can continue to offer the current level of services. D. Determine.
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True / False Questions 51.Under GASB standards, only proprietary funds prepare a statement of cash flows.  52.Similar in purpose to the International Accounting Standard Board (IASB), there is also an International Public Sector Accounting Standards Board.  53.The General Fund data for a blended component unit should be reported as a special.
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11.External users of accounting information include investors, customers, governmental agencies, and suppliers. 12.The functional management information system (such as marketing, manufacturing, human resources, and financial) are logically independent. 13.A decision support system (DSS) is tailored to the strategic information needs of top-level management. 14.Business processes are always triggered by some economic event, and.
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11.Effective management of cash and investments of individual funds may be enhanced by placing the cash and investments in a pool under the control of the treasurer of the government or other official. 12.When a cash and investment pool is created, the assets of each fund entering the pool should.
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True / False Questions 1.Responsibility for setting accounting and reporting standards for federal agencies rests primarily with the Federal Accounting Standards Advisory Board.  2.By law, federal agencies must incorporate the accounting standards (GAAP) established for the federal government into their financial management systems.  3.The objectives of federal financial reporting are to.
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Essay Questions 50.If the revenues budget of a government is prepared on the modified accrual basis is there any reason why the revenues budget should be converted to a cash receipts budget? Explain. 51."Because a budgetary comparison statement is required for conformity with GAAP (under GASBS 34), resource management purposes are.
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True / False Questions 1.A state has the obligation to monitor and regulate a not-for-profit (NFP) organization because it granted the NFP tax-exempt status through the not-for-profit corporation laws.  2.The federal government's primary objective in regulating not-for-profit organizations through the income tax laws is to limit the number of exempt organizations.
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11.The financial statements of the U.S. government are prepared using generally accepted accounting principles promulgated by the Governmental Accounting Standards Board.  12.Federal government agencies prepare a management's discussion and analysis (MD&A) to be included in their general purpose federal financial report.  13.Under SFFAS No. 2, all federal agencies are defined.
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92.The Motor Vehicle Repair Fund of Laramee County provides centralized repair for county-owned vehicles. For the following summarized transactions and events for the year ended June 30, provide the fund level entries in general journal form required to conform to generally accepted accounting principles. If no entry is needed, so.
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Multiple Choice Questions 17.Which of the following is not a part of the FASAB due process for establishing a federal financial accounting standard?  A. Public comment on a discussion memorandum. B. Issuing an exposure draft. C. Unanimous approval by the FASAB. D. Support (or lack of opposition) of the standard by.
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21.An information center is a support facility for end users in an organization. 22.DBMS is the hands-on use of computers by end users. 23.Information system specialists are used in the traditional approach to data processing for end users. 24.EDI is a key component to quick-response technology system. 25.The philosophy that one should do the.
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Multiple Choice Questions 18.Audits of state and local governments may be performed by all of the following except  A. Independent CPAs. B. State audit agencies. C. Federal grantor agencies. D. The Office of Management and Budget (OMB). 19.Governments and not-for-profit entities may be subject to each of the following levels of.
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31.Which of the following could be included in the performance indicator measure provided by a nongovernmental not-for-profit hospital?  A. Contribution to an endowment. B. Gain on sale of equipment. C. Grant restricted for diabetes research. D. Interest income that is temporarily restricted. 32.Which of the following would usually be considered.
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38.All of the following reports are included in the reporting package resulting from the single audit except  A. Financial statements and schedule of expenditures of federal awards. B. Summary schedule of prior audit findings. C. Report on efficiency and effectiveness. D. Corrective action plan. 39.Which of the following is not.
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