Question : 73.Which of the following statements false? A)Resources representing supplies and prepaid : 1255465

73.Which of the following statements is false?

A)Resources representing supplies and prepaid items are classified in governmental funds as Nonspendable Fund balance.

B)Capital Projects, debt service and permanent funds do not typically record budgets.

C)Debt service and permanent funds do not record encumbrances.

D)Principal of permanent funds is classified as Committed Fund Balance

74.With respect to Capital Projects Funds, which of the following is correct?

A)These funds commonly account for resources provided by long-term debt issues or dedicated taxes.

B)Capital assets appear in both the government-wide and the fund basis financial statements

C)A and B are both correct

D)Neither A or B is correct

75.With respect to Debt Service Funds, which of the following is not correct?

A)Typically, resources are provided through transfers from the General or other funds.

B)There are two types of debt service expenditures:  interest and principal

C)In most cases, interest and principal payments are not recorded until payment is due.

D)Encumbrances are recorded to reflect principal payments that are expected to come due within the current accounting period.

76.If a trust is to be used for the benefit individuals, private organizations or other governments, the following fund(s) should be used:

A) Special revenue fund.

B) Permanent fund.

C) Private purpose fund.

D) Either A or B, depending upon whether the principal must be maintained.

77.With respect to Permanent Funds, which of the following is not true?

A)The principal is classified as Nonspendable Fund balance

B)Permanent Funds are created when resources are provided by private donation.

C)Permanent Funds use the current financial resources measurement focus.

D)Earnings in excess of expenditures must be added to principal corpus.

78.Which of the following fund(s) should be used if resources are provided by a donor with the stipulation that they be used for the benefit of the citizenry?

A) Special revenue fund.

B) Permanent fund.

C) Private purpose fund.

D) Either A or B, depending upon whether the principal must be maintained.

79.Which of the following statements is false?

A)Debt service funds are required to report accrued interest payable as current liabilities.

B)All of the governmental funds use the modified accrual basis of accounting

C)General fixed assets that are acquired with governmental fund resources are recorded as expenditures in the governmental funds but are displayed as capital assets in the governmental-wide financial statements

D)Permanent funds reflect resources that are legally restricted so that principal may not be expended and earnings are used to benefit the government or its citizenry

80.When a government acquires general fixed assets under a capital lease agreement, the asset should be recorded in the General Fund’s fund basis financial statements:

A)As a capital asset and lease obligation at the inception of the lease agreement at the lesser of the present value of the minimum lease payments or the fair market value of the property

B)as an expenditure when payments are made

C)As a capital asset and lease obligation at the inception of the lease agreement for the total lease payments

D)as an expense when payments are made

81.Which of the following is a common source of funding for capital projects?

A)Issuance of long term debt

B)Proceeds of dedicated taxes

C)Grants from other governments

D)All of the above are sources of funding for capital projects

82.Which of the following is true with respect to special assessment levies?

A)Taxpayers may opt out of a service-type special assessment if they agree to not use the service funded by the assessment

B)Service-type special assessments may not be accounted for in the General or special revenue fund.

C)Construction-type special assessments are accumulated until there is enough money to finance the construction project

D)If the government is not liable for the special assessment debt directly or through guarantee, the special assessment is accounted for in an agency fund