GOVT 407 Exam 3 | Questions & Answers | Grade A| 100% Correct (Verified Solutions)

GOVT 407 Exam 3 | Questions & Answers | Grade A| 100% Correct (Verified Solutions) GOVT 407 EXAM 3 2026/2027 | GRADED A+ | 100% VERIFIED [ First Amendment ] [ Due Process ] [ Equal Protection ] [ Privacy Rights ] Exam Overview & Structure Exam Structure Multiple-Choice (Single-Best-Answer) 90–120 Minutes Time Limit Application & Analysis Focused Case-Based Scenarios Core Domains • First Amendment (Speech, Religion) • 14th Amendment (Due Process, Equal Protection) • Right to Privacy • Voting Rights • Second Amendment • Eighth Amendment Introduction: This exam evaluates understanding of key Supreme Court decisions, constitutional doctrines, levels of scrutiny, and application of constitutional principles to factual scenarios. Mastery is essential for political science majors and pre-law students. Answer Format All questions are presented in yellow for clear distinction and readability. All correct answers are presented in yellow, followed by clearly defined, legally accurate rationales in italic format that reinforce constitutional principles, Supreme Court holdings, doctrinal tests, and legal reasoning required for GOVT 407 exam success. Grant proceeds received from the state for a capital project would be recorded in a capital projects fund of a city government as a (an): A) Revenue. B) Other Financing Source C) Direct addition to Fund Balance. D) Other Financing Use A) Revenue 1/ 29 2/ 29 Governmental funds, other than the General Fund, are considered major if: I. Total Assets, Liabilities, Revenues, or Expenditures of that individual governmental fund are at least 10% of the corresponding total (assets, liabilities, and so forth) for all governmental funds II. Total Assets, Liabilities, Revenues, or Expenditures of the individual governmental fund are at least 5% of the corresponding total for all governmental and enterprise funds combined A) I only. B) II only. C) Either I or II, but need not be both. D) Both I and II. D) Both I and II. Premiums generated from the issuance of bonds for a capital projects fund are generally: A) Transferred to the General Fund. B) Retained in the capital projects fund. C) Transferred to the debt service fund. D) None of the choices C) Transferred to the debt service fund. Which of the following should be accounted for in a D) A gift of $3,000,000 to a city, to be invested permanently, with the proceeds to be permanent fund? used to maintain the city war memorials. A) A gift of $300,000 to a school board, to be given out $10,000 a year to the class valedictorian as a college scholarship. B) A gift of $300,000 to a city, to be expended next year to purchase books for the city library C) A gift of $3,000,000 to a city, to be invested permanently, with the proceeds to be used to distribute to one or more nonprofit groups D) A gift of $3,000,000 to a city, to be invested permanently, with the proceeds to be used to maintain the city war memorials. When taxes are levied specifically for payment of interest and principal on long-term debt, those taxes are recognized: A) As revenues in the General Fund with transfers made to the debt service funds for payments. B) As Other Financing Sources in the debt service fund. C) As revenues in the capital projects fund with transfers made to the debt service funds for payments. D) As revenues in the debt service fund D) As revenues in the debt service fund Proceeds of tax supported bonds are recognized in a capital projects fund as a(an): A) Revenue. B) Liability. C) Other Financing Source. D) Other Financing Use C) Other Financing Source. 3/ 29 4/ 29 Which of the following is true regarding accounting for investments of permanent funds? A) Gains and losses on investments would not be reported in the Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances but are reported in the government-wide Statement of Activities. B) Investments with determinable fair values must be reported at fair value. C) Gains and losses on investments would not be reported in the Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances but are reported in the government-wide Statement of Activities; and investments with determinable fair values must be reported at fair value. D) Neither of the choices is true. B) Investments with determinable fair values must be reported at fair value 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. D) Principal of permanent funds is classified as Committed Fund Balance. With respect to Debt Service Funds, which of the following is correct? A) Debt service funds may be required to service term and serial bonds, notes, capital leases, or warrants. B) Debt service funds are used to account for financial resources that are intended to provide payments of principal only as they come due. C) Debt service funds are created for debt issues where the activities of proprietary funds generate sufficient cash to make interest and principal payments. D) If taxes and/or special assessments are levied specifically for payment of interest and principal on long- term debt, those taxes are recognized as transfers in for the debt service fund. A) Debt service funds may be required to service term and serial bonds, notes, capital leases, or warrants. On October 1, 2016, the City of Mizner issued $5,000,000 in 4%, general obligation bonds at 101 for the purpose of constructing an addition to City Hall. The premium was transferred to a debt service fund. A total of $4,968,750 was used to construct the addition, which was completed prior to June 30, 2017. The remaining fund were transferred to the debt service fund. The bonds were dated October 1, 2016, and paid interest on April 1 and October 1. The first of 20 annual principal payments of $250,000 is due October 1, 2017. The fiscal year for Mizner is July 1- June 30. 10) What would be the amount of debt service expenditures reported in the fiscal year ended June 30, 2018? A) $450,000. B) $445,000. C) $200,000. D) $100,000 B) $445,000 5/ 29 On October 1, 2016, the City of Mizner issued $5,000,000 in 4%, general obligation bonds at 101 for the purpose of constructing an addition to City Hall. The premium was transferred to a debt service fund. A total of $4,968,750 was used to construct the addition, which was completed prior to June 30, 2017. The remaining fund were transferred to the debt service fund. The bonds were dated October 1, 2016, and paid interest on April 1 and October 1. The first of 20 annual principal payments of $250,000 is due October 1, 2017. The fiscal year for Mizner is July 1- June 30. 11) 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) Encumbrances are recorded to reflect principal payments that are expected to come due within the current accounting period. C) There are two types of debt service expenditures: interest and principal. D) In most cases, interest and principal payments are not recorded until payment is due B) Encumbrances are recorded to reflect principal payments that are expected to come due within the current accounting period During the fiscal year ended December 31, 2017, the City of Johnstown issued 6% general obligation serial bond in the amount of $2,000,000 at 102 ($2,040,000) and used $1,980,000 of the proceeds to construct a fire station. The $40,000 premium was transferred to a debt service fund. The $20,000 left in the capital projects fund at the end of the project was later transferred to the debt service fund. The bonds were dated April 1, 2017 and paid interest on October 1 and April 1. The first of 10 equal annual principal payments was due on April 1, 2018 12) How would the government account for the transfer of the unused bond proceeds? A) As an other financing source in the debt service fund and as an other financing use in the capital projects fund. B) As a revenue in the debt service fund and as an expenditure in the capital projects fund. C) As an other financing source in the capital projects fund and as an other financing use in the debt service fund. D) As a special item in both the debt service and capital project funds A) As an other financing source in the debt service fund and as an other financing use in the capital projects fund During the fiscal year ended December 31, 2017, the City of Johnstown issued 6% general obligation serial bond in the amount of $2,000,000 at 102 ($2,040,000) and used $1,980,000 of the proceeds to construct a fire station. The $40,000 premium was transferred to a debt service fund. The $20,000 left in the capital projects fund at the end of the project was later transferred to the debt service fund. The bonds were dated April 1, 2017 and paid interest on October 1 and April 1. The first of 10 equal annual principal payments was due on April 1, 2018. 13) A transfer from the General Fund to a debt service fund to make annual payments on principal and interest would be recorded in the debt service fund as a (an): A) Other Financing Source. B) Revenue. C) Direct addition to Fund Balance. A) Other Financing Source 6/ 29 D) Other Financing Use The following are sources of funds for the debt service fund except A) Tax levies specifically designed for debt service. B) General taxes levied by the General Fund and transferred to the debt service fund. C) Special assessments levied against property. D) All of the choices are sources of funds for the debt service fund D) All of the choices are sources of funds for the debt service fund On April 1, 2017, the City of Southern Ponds issued C) $356,000 $4,000,000 in 4% general obligation, tax supported bonds a 101 for the purpose of constructing a new police station. The premium was transferred to a debt service fund. A total of $3,990,000 was used to construct the police station, which was completed before December 31, 2017, th end of the fiscal year. The remaining funds were transferred to the debt service fund. The bonds were dated April 1, 2017, and paid interest on October 1 and April 1. The first of 20 equal annual principal payments of $200,000 is due April 1, 2018. 15) What amount would be reported as debt service expenditures for 2018? A) $400,000. B) $362,000. C) $356,000. D) $280,000. On April 1, 2017, the City of Southern Ponds issued D) As a capital asset in the government-wide Statement of Net Position; and as an $4,000,000 in 4% general obligation, tax supported bonds expenditure in the capital projects fund a 101 for the purpose of constructing a new police station. The premium was transferred to a debt service fund. A total of $3,990,000 was used to construct the police station, which was completed before December 31, 2017, th end of the fiscal year. The remaining funds were transferred to the debt service fund. The bonds were dated April 1, 2017, and paid interest on October 1 and April 1. The first of 20 equal annual principal payments of $200,000 is due April 1, 2018. 16) How would the $3,990,000 be accounted for? A) As a capital asset in the government-wide Statement of Net Position. B) As an expenditure in the capital projects fund. C) As an expenditure in the capital projects fund and as an expense in the government-wide Statement of Activities. D) As a capital asset in the government-wide Statement of Net Position; and as an expenditure in the capital projects fund On April 1, 2017, the City of Southern Ponds issued D) Either Special revenue fund; or Permanent fund, depending upon whether the $4,000,000 in 4% general obligation, tax supported bonds principal must be maintained a 101 for the purpose of constructing a new police station. The premium was transferred to a debt service fund. A total of $3,990,000 was used to construct the police station, which was completed before December 31, 2017, the end of the fiscal year. The remaining funds were transferred to the debt service fund. The bonds were dated April 1, 2017, and paid interest on October 1 and April 1. The first of 20 equal annual principal payments of $200,000 is due April 1, 2018. 17) 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 Special revenue fund; or Permanent fund, depending upon whether the principal must be maintained 7/ 29 8/ 29 On April 1, 2017, the City of Southern Ponds issued D) Debit to Cash and credit to Other Financing Sources - Transfer In. $4,000,000 in 4% general obligation, tax supported bonds a 101 for the purpose of constructing a new police station. The premium was transferred to a debt service fund. A total of $3,990,000 was used to construct the police station, which was completed before December 31, 2017, th end of the fiscal year. The remaining funds were transferred to the debt service fund. The bonds were dated April 1, 2017, and paid interest on October 1 and April 1. The first of 20 equal annual principal payments of $200,000 is due April 1, 2018. 18) The journal entry for the Debt Service fund upon the receipt of money from the General Fund would be: A) Debit to Cash and credit to Other Financing Uses - Transfer Out. B) Debit to Cash and a credit to Transfers Payable. C) Debit to Other Financing Sources - Transfer In and credit to Cash. D) Debit to Cash and credit to Other Financing Sources - Transfer In. On April 1, 2017, the City of Southern Ponds issued A) Special Revenue Funds $4,000,000 in 4% general obligation, tax supported bonds a 101 for the purpose of constructing a new police station. The premium was transferred to a debt service fund. A total of $3,990,000 was used to construct the police station, which was completed before December 31, 2017, th end of the fiscal year. The remaining funds were transferred to the debt service fund. The bonds were dated April 1, 2017, and paid interest on October 1 and April 1. The first of 20 equal annual principal payments of $200,000 is due April 1, 2018. 19) Budgets are ty p ically recorded for which of the following: A) Special Revenue Funds. B) Capital Projects Funds C) Debt Service Funds. D) None of the choices. During the fiscal year ended December 31, 2017, the City A) $1,980,000 of Johnstown issued 6% general obligation serial bond in the amount of $2,000,000 at 102 ($2,040,000) and used $1,980,000 of the proceeds to construct a fire station. The $40,000 premium was transferred to a debt service fund. The $20,000 left in the capital projects fund at the end of the project was later transferred to the debt service fund. The bonds were dated April 1, 2017 and paid interest on October 1 and April 1. The first of 10 equal annual principal payments was due on April 1, 2018 20) The amount of capital outlay expenditures reported by the capital projects fund would be: A) $1,980,000. B) $2,000,000. C) $2,040,000. D) $3,000,000 9/ 29 During the fiscal year ended December 31, 2017, the City B) Exist only for the duration of the project for which they are created of Johnstown issued 6% general obligation serial bond in the amount of $2,000,000 at 102 ($2,040,000) and used $1,980,000 of the proceeds to construct a fire station. The $40,000 premium was transferred to a debt service fund. The $20,000 left in the capital projects fund at the end of the project was later transferred to the debt service fund. The bonds were dated April 1, 2017 and paid interest on October 1 and April 1. The first of 10 equal annual principal payments was due on April 1, 2018 21) Capital project funds: A) Receive all of their money from tax revenues. B) Exist only for the duration of the project for which they are created. C) Record debt issuances as revenues. D) All of the choices During the fiscal year ended December 31, 2017, the City D) Deferred Serial Bonds of Johnstown issued 6% general obligation serial bond in the amount of $2,000,000 at 102 ($2,040,000) and used $1,980,000 of the proceeds to construct a fire station. The $40,000 premium was transferred to a debt service fund. The $20,000 left in the capital projects fund at the end of the project was later transferred to the debt service fund. The bonds were dated April 1, 2017 and paid interest on October 1 and April 1. The first of 10 equal annual principal payments was due on April 1, 2018 Which of the following serial bonds has the first scheduled installment delayed for a period of more than 1 year after the date of the issue? A) Annuity Serial Bonds. B) Regular Serial Bonds. C) Irregular Serial Bonds. D) Deferred Serial Bonds During the fiscal year ended December 31, 2017, the City C) Resources transferred to the debt service fund from the General Fund would of Johnstown issued 6% general obligation serial bond in typically be classified as Other Financing Sources by the debt service fund. the amount of $2,000,000 at 102 ($2,040,000) and used $1,980,000 of the proceeds to construct a fire station. The $40,000 premium was transferred to a debt service fund. The $20,000 left in the capital projects fund at the end of the project was later transferred to the debt service fund. The bonds were dated April 1, 2017 and paid interest on October 1 and April 1. The first of 10 equal annual principal payments was due on April 1, 2018 23) Which of the following is true with respect to long- term debt? A) Term bonds mature in equal installments over the term of the bond. B) If a sinking fund is required by creditor or law, the unexpended resources of its debt service fund would be classified as assigned. C) Resources transferred to the debt service fund from the General Fund would typically be classified as Other Financing Sources by the debt service fund. D) If bonds supporting a capital project are issued at a premium, typically the premium may be used on capital expenditures 10/ 29 During the fiscal year ended December 31, 2017, the City C) A gift of $65,000 to a city to be invested permanently, with the proceeds to be of Johnstown issued 6% general obligation serial bond in used to buy books for the city library. the amount of $2,000,000 at 102 ($2,040,000) and used $1,980,000 of the proceeds to construct a fire station. The $40,000 premium was transferred to a debt service fund. The $20,000 left in the capital projects fund at the end of the project was later transferred to the debt service fund. The bonds were dated April 1, 2017 and paid interest on October 1 and April 1. The first of 10 equal annual principal payments was due on April 1, 2018 24) Which of the following would be accounted for as a permanent fund? A) A gift of $65,000 to a school district, to be invested permanently, with the proceeds to be awarded as college scholarships to graduating seniors. B) A gift of $65,000 to a school district, to be used for landscaping improvements. C) A gift of $65,000 to a city to be invested permanently, with the proceeds to be used to buy books for the city library. D) A gift of $65,000 to a school district, to be invested permanently, with the proceeds to be awarded as college scholarships to graduating seniors; and a gift of 6 $65,000 to a city to be invested permanently, with the proceeds to be used to buy books for the city library Which of the following statements is correct? B) The principal of a permanent fund is classified as nonspendable fund balance. A) All the expenditures of a capital project fund are for capital assets and are recorded as restricted fund balance in the fund-basis statements. B) The principal of a permanent fund is classified as nonspendable fund balance. C) Long-term assets are depreciated in the capital projects fund. D) Interest on bonds issued for a school building would be paid by the capital projects fund. If bonds issued to fund a capital project are sold at a D) Recorded as Other Financing Sources - Premium on Bonds in the capital premium, the additional money received is: projects fund; and transferred from the capital projects fund to the debt service fund A) Recorded as Other Financing Sources - Premium on Bonds in the capital projects fund. B) Transferred from the capital projects fund to the debt service fund. C) Transferred from the capital projects fund to the General Fund. D) Recorded as Other Financing Sources - Premium on Bonds in the capital projects fund; and transferred from the capital projects fund to the debt service fund. Capital project funds record the proceeds of debt issued B) Other Financing Sources as: A) Liabilities. B) Other Financing Sources. C) Revenues. D) Expenses 11/ 29 During the fiscal year ended December 31, 2017, the City D) As an other financing use in the capital projects fund of Johnstown issued 6% general obligation serial bond in the amount of $2,000,000 at 102 ($2,040,000) and used $1,980,000 of the proceeds to construct a fire station. The $40,000 premium was transferred to a debt service fund. The $20,000 left in the capital projects fund at the end of the project was later transferred to the debt service fund. The bonds were dated April 1, 2017 and paid interest on October 1 and April 1. The first of 10 equal annual principal payments was due on April 1, 2018 28) How would the bond sale be recorded? A) As a liability in the debt service fund. B) As a liability in the capital projects fund. C) As an other financing source in the debt service fund. D) As an other financing use in the capital projects fund During the fiscal year ended December 31, 2017, the City C) Included as revenues of the debt service fund. of Johnstown issued 6% general obligation serial bond in the amount of $2,000,000 at 102 ($2,040,000) and used $1,980,000 of the proceeds to construct a fire station. The $40,000 premium was transferred to a debt service fund. The $20,000 left in the capital projects fund at the end of the project was later transferred to the debt service fund. The bonds were dated April 1, 2017 and paid interest on October 1 and April 1. The first of 10 equal annual principal payments was due on April 1, 2018 29) If taxes are levied specifically for payment of interest and principal on long term debt, those taxes are A) Included as a liability of the General Fund. B) Recorded as operating transfers to the debt service fund. C) Included as revenues of the debt service fund. D) Included as a liability of the General Fund; and recorded as operating transfers to the debt service fund Which of the following is not true regarding permanent C) Permanent funds are appropriate when a gift must be invested and the proceeds funds? used to benefit individuals or organizations. A) Permanent funds are considered governmental funds. B) Permanent funds use the current financial resources measurement focus and modified accrual basis of accounting. C) Permanent funds are appropriate when a gift must be invested and the proceeds used to benefit individuals or organizations. D) Major permanent funds would be reported in the Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances Which of the following is correct regarding Government A) If a trust is to benefit individuals, private organizations, or other governments, it Trust Accounting? should be accounted for in a private-purpose trust fund A) If a trust is to benefit individuals, private organizations, or other governments, it should be accounted for in a private-purpose trust fund. B) The journal entry to establish a permanent fund would include a credit to Restricted Fund Balance. C) Trust funds accounted for in a permanent fund use accrual accounting. D) If a trust is to benefit individuals, private organizations, or other governments, it may be accounted for in a permanent or special revenue fund, depending upon whether the principal must be maintained. 12/ 29 On October 1, 2016, the City of Mizner issued $5,000,000 C) As an expenditure of the capital projects fund and a capital asset in the in 4%, general obligation bonds at 101 for the purpos of government-wide Statement of Net Position. constructing an addition to City Hall. The premium was transferred to a debt service fund. A total of $4,968,750 was used to construct the addition, which was completed prior to June 30, 2017. The remaining fund were transferred to the debt service fund. The bonds were dated October 1, 2016, and paid interest on April 1 and October 1. The first of 20 annual principal payments of $250,000 is due October 1, 2017. The fiscal year for Mizner is July 1- June 30 32) How would the construction costs of $4,968,750 be reported at year-end? A) As a capital asset in the Statement of Net Position only. B) As an expenditure of the capital projects fund and an expense in the government-wide Statement of Activities. C) As an expenditure of the capital projects fund and a capital asset in the government-wide Statement of Net Position. D) As an expenditure of the capital projects fund only. During the fiscal year ended December 31, 2017, the City C) $314,000 of Johnstown issued 6% general obligation serial bond in the amount of $2,000,000 at 102 ($2,040,000) and used $1,980,000 of the proceeds to construct a fire station. The $40,000 premium was transferred to a debt service fund. The $20,000 left in the capital projects fund at the end of the project was later transferred to the debt service fund. The bonds were dated April 1, 2017 and paid interest on October 1 and April 1. The first of 10 equal annual principal payments was due on April 1, 2018 What would be the amount of expenditures recorded by the debt service fund for the fiscal year ended December 31, 2018? A) $440,000. B) $324,000. C) $314,000. D) $120,000 13/ 29 During the fiscal year ended December 31, 2017, the City A) Debit Encumbrances Control and credit Budgetary Fund Balance -- Reserve for of Johnstown issued 6% general obligation serial bond in Encumbrances the amount of $2,000,000 at 102 ($2,040,000) and used $1,980,000 of the proceeds to construct a fire station. The $40,000 premium was transferred to a debt service fund. The $20,000 left in the capital projects fund at the end of the project was later transferred to the debt service fund. The bonds were dated April 1, 2017 and paid interest on October 1 and April 1. The first of 10 equal annual principal payments was due on April 1, 2018 When a purchase order is issued under a Capital Projects fund, how should the transaction be recorded? A) Debit Encumbrances Control and credit Budgetary Fund Balance -- Reserve for Encumbrances. B) Debit Expenditures and credit Vouchers payable. C) Debit Encumbrances Control and credit Vouchers payable. D) Debit Expenditures and credit Budgetary Fund Balance -- Reserve for Encumbrances. During the fiscal year ended December 31, 2017, the City D) Interest on long-term debt is generally accrued; it is recognized as an of Johnstown issued 6% general obligation serial bond in expenditure in the year in which the interest liability is incurred the amount of $2,000,000 at 102 ($2,040,000) and used $1,980,000 of the proceeds to construct a fire station. The $40,000 premium was transferred to a debt service fund. The $20,000 left in the capital projects fund at the end of the project was later transferred to the debt service fund. The bonds were dated April 1, 2017 and paid interest on October 1 and April 1. The first of 10 equal annual principal payments was due on April 1, 2018 With respect to Debt Service Funds, which of the following is incorrect? A) Debt service funds are used to account for financial resources that are intended to provide payments of interest and principal as they come due. B) Debt service funds are not created for debt issues where the activities of proprietary funds are intended to generate sufficient cash to make interest and principal payments. C) If taxes and/or special assessments are levied specifically for payment of interest and principal on long- term debt, those taxes are recognized as revenues of the debt service fund. D) Interest on long-term debt is generally accrued; it is recognized as an expenditure in the year in which the interest liability is incurred 14/ 29 During the fiscal year ended December 31, 2017, the City D) The funds would be transferred to a debt service fund; the capital projects fund of Johnstown issued 6% general obligation serial bond in would debit Other Financing Uses-Transfers Out and the debt service fund would the amount of $2,000,000 at 102 ($2,040,000) and used credit Other Financing Sources Transfers In. $1,980,000 of the proceeds to construct a fire station. The $40,000 premium was transferred to a debt service fund. The $20,000 left in the capital projects fund at the end of the project was later transferred to the debt service fund. The bonds were dated April 1, 2017 and paid interest on October 1 and April 1. The first of 10 equal annual principal payments was due on April 1, 2018 When a capital project has been constructed entirely with bond proceeds and funds are left over at the end of the project, which of the following would normally take place? A) The funds would be transferred to a debt service fund; the capital projects fund would debit Expenditures and the debt service fund would credit Other Financing Sources- Transfers In. B) The funds would be transferred to the General Fund and expended for any purpose desired by the management of the government. C) The funds would be returned to the bondholders. D) The funds would be transferred to a debt service fund; the capital projects fund would debit Other Financing Uses-Transfers Out and the debt service fund would credit Other Financing Sources Transfers In. Encumbrance accounting is only typically used for: C) Capital Projects Funds A) Permanent Funds. B) Debt Service Funds. C) Capital Projects Funds. D) None of the choices. Which of the following would be accounted for as a C) A gift of $500,000 to a city, to be invested permanently, with the proceeds to be permanent fund? used to maintain the city cemetery A) An intergovernmental grant of $500,000 to a city to be used for low income housing. B) A gift of $500,000 to a city, to be invested permanently, with the proceeds to be distributed as scholarships. C) A gift of $500,000 to a city, to be invested permanently, with the proceeds to be used to maintain the city cemetery. D) A gift of $500,000 to a city to be used for a new caretaker's residence at the local cemetery What is the correct debit or credit for the following D) Debit: Encumbrances Control scenario: A contract was issued for the major part of work to be done by a private contractor in the amount of $1,200,000 for a new County court house? A) Debit: Budgetary Fund Balance -- Reserve for Encumbrances. B) Debit: Construction expenditures. C) Credit: Cash. D) Debit: Encumbrances Control 15/ 29 On October 1, 2016, the City of Mizner issued $5,000,000 B) As a $5,050,000 other financing source in the capital projects fund, a $50,000 in 4%, general obligation bonds at 101 for the purpose of other financing use in the capital projects fund, and a $50,000 other financing constructing an addition to City Hall. The premium was source in the debt service fund transferred to a debt service fund. A total of $4,968,750 was used to construct the addition, which was completed prior to June 30, 2017. The remaining fund were transferred to the debt service fund. The bonds were dated October 1, 2016, and paid interest on April 1 and October 1. The first of 20 annual principal payments of $250,000 is due October 1, 2017. The fiscal year for Mizner is July 1- June 30. In addition to a $5,000,000 liability in the government- wide Statement of Net Position, how would the bond sale be reported? A) As a $4,968,750 revenue in the capital projects fund and a $50,000 revenue in the debt service fund. B) As a $5,050,000 other financing source in the capital projects fund, a $50,000 other financing use in the capital projects fund, and a $50,000 other financing source in the debt service fund. C) As a $5,000,000 other financing source in the capital projects fund, a $50,000 other financing source in the debt service fund, and as a $5,000,000 liability in the debt service fund. D) As a $5,000,000 revenue in the capital projects fund, a $50,000 revenue in the debt service fund, and a $5,000,000 expenditure in the debt service fund On October 1, 2016, the City of Mizner issued $5,000,000 D) When a contract is signed or issued in 4%, general obligation bonds at 101 for the purpose of constructing an addition to City Hall. The premium was transferred to a debt service fund. A total of $4,968,750 was used to construct the addition, which was completed prior to June 30, 2017. The remaining fund were transferred to the debt service fund. The bonds were dated October 1, 2016, and paid interest on April 1 and October 1. The first of 20 annual principal payments of $250,000 is due October 1, 2017. The fiscal year for Mizner is July 1- June 30. An encumbrance in a capital project fund is created A) When the project is paid for in full. B) When the work on the project begins. C) When the work on the project is finished. D) When a contract is signed or issued On April 1, 2017, the City of Southern Ponds issued D) $ 80,000 $4,000,000 in 4% general obligation, tax supported bonds a 101 for the purpose of constructing a new police station. The premium was transferred to a debt service fund. A total of $3,990,000 was used to construct the police station, which was completed before December 31, 2017, the end of the fiscal year. The remaining funds were transferred to the debt service fund. The bonds were dated April 1, 2017, and paid interest on October 1 and April 1. The first of 20 equal annual principal payments of $200,000 is due April 1, 2018 What amount would be reported as debt service expenditures for 2017? A) $560,000. B) $360,000. C) $160,000. D) $ 80,000 16/ 29 On April 1, 2017, the City of Southern Ponds issued A) These funds commonly account for resources provided by long-term debt issues $4,000,000 in 4% general obligation, tax supported bonds or dedicated taxes. a 101 for the purpose of constructing a new police station. The premium was transferred to a debt service fund. A total of $3,990,000 was used to construct the police station, which was completed before December 31, 2017, the end of the fiscal year. The remaining funds were transferred to the debt service fund. The bonds were dated April 1, 2017, and paid interest on October 1 and April 1. The first of 20 equal annual principal payments of $200,000 is due April 1, 2018 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) These funds commonly account for resources provided by long-term debt issues or dedicated taxes; and Capital assets appear in both the government-wide and the fund basis financial statements. D) Neither these funds commonly account for resources provided by long-term debt issues or dedicated taxes; or Capital assets appear in both the government-wide and the fund basis financial statements is correct On April 1, 2017, the City of Southern Ponds issued D) All of the choices are sources of funding for capital project $4,000,000 in 4% general obligation, tax supported bonds a 101 for the purpose of constructing a new police station. The premium was transferred to a debt service fund. A total of $3,990,000 was used to construct the police station, which was completed before December 31, 2017, the end of the fiscal year. The remaining funds were transferred to the debt service fund. The bonds were dated April 1, 2017, and paid interest on October 1 and April 1. The first of 20 equal annual principal payments of $200,000 is due April 1, 2018 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 choices are sources of funding for capital projects 17/ 29 During the fiscal year ended December 31, 2017, the City B) As an other financing source in the debt service fund of Johnstown issued 6% general obligation serial bond in the amount of $2,000,000 at 102 ($2,040,000) and used $1,980,000 of the proceeds to construct a fire station. The $40,000 premium was transferred to a debt service fund. The $20,000 left in the capital projects fund at the end of the project was later transferred to the debt service fund. The bonds were dated April 1, 2017 and paid interest on October 1 and April 1. The first of 10 equal annual principal payments was due on April 1, 2018 How would the $40,000 premium be accounted for? A) Amortized to interest expenditure in the debt service fund. B) As an other financing source in the debt service fund. C) Amortized to interest expenditure in the debt service fund; and as an other financing source in the debt service fund. D) None of the choices During the fiscal year ended December 31, 2017, the City C) Annuity of Johnstown issued 6% general obligation serial bond in the amount of $2,000,000 at 102 ($2,040,000) and used $1,980,000 of the proceeds to construct a fire station. The $40,000 premium was transferred to a debt service fund. The $20,000 left in the capital projects fund at the end of the project was later transferred to the debt service fund. The bonds were dated April 1, 2017 and paid interest on October 1 and April 1. The first of 10 equal annual principal payments was due on April 1, 2018 Which of the following bond ty pes has a payment schedule in which the amount of annual principal repayment is scheduled to increase each year by ap p roximately the same amount that interest payments decrease? A) Regular. B) Deferred. C) Annuity. D) Irregular On October 1, 2016, the City of Mizner issued $5,000,000 B) As an other financing source in the debt service fund and as an other financing in 4%, general obligation bonds at 101 for the purpose of use in the capital projects fund constructing an addition to City Hall. The premium was transferred to a debt service fund. A total of $4,968,750 was used to construct the addition, which was completed prior to June 30, 2017. The remaining fund were transferred to the debt service fund. The bonds were dated October 1, 2016, and paid interest on April 1 and October 1. The first of 20 annual principal payments of $250,000 is due October 1, 2017. The fiscal year for Mizner is July 1- June 30 How would the government account for the unused bond proceeds? A) As an other financing source in the government-wide Statement of Activities. B) As an other financing source in the debt service fund and as an other financing use in the capital projects fund. C) As a revenue in the debt service fund and as an expenditure in the capital projects fund. D) As an other financing source in the capital projects fund and as an other financing use in the debt service fund 18/ 29 On October 1, 2016, the City of Mizner issued $5,000,000 D) $100,000 in 4%, general obligation bonds at 101 for the purpose of constructing an addition to City Hall. The premium was transferred to a debt service fund. A total of $4,968,750 was used to construct the addition, which was completed prior to June 30, 2017. The remaining fund were transferred to the debt service fund. The bonds were dated October 1, 2016, and paid interest on April 1 and October 1. The first of 20 annual principal payments of $250,000 is due October 1, 2017. The fiscal year for Mizner is July 1- June 30 What amount would be reported as debt service expenditures in the year ended June 30, 2017? A) $250,000. B) $200,000. C) $450,000. D) $100,000 With respect to Debt Service Funds, which of the following A) Payments under capital lease obligations may be reported in debt service funds is true? A) Payments under capital lease obligations may be reported in debt service funds. B) Debt service funds use accrual accounting. C) Each separate long-term obligation must be accounted for in a separate debt service fund. D) All of the choices are true. General fixed assets that are acquired with governmental D) None of the choices fund resources are reported as assets in the: A) General Fund. B) Capital Projects Fund. C) General Fund or Capital Projects Fund, depending upon which fund provided the resources. D) None of the choices Which of the following statements is true? C) The principal of permanent funds are classified as Nonspendable Fund Balance. A) Fund balances of debt service funds are classified as Restricted and Unrestricted. B) The fund balance of permanent funds should be classified as Nonspendable, Spendable and Committed. C) The principal of permanent funds are classified as Nonspendable Fund Balance. D) Any governmental fund may have an Unassigned Fund Balance. When a payment is due to a contractor from capital C) Expenditures-Capital Outlay. projects fund resources, the debit would be to: A) A capital asset account. B) Encumbrances Control. C) Expenditures-Capital Outlay. D) None of the choices, no entry is made until payment. Which of the following statements is false? B) Debt service funds are required to report accrued interest payable A) All of the governmental funds use the modified accrual basis of accounting. B) Debt service funds are required to report accrued interest payable. 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 19/ 29 Regarding capital projects funds, which of the following is A) Capital projects funds exist only for the duration of the project for which it is correct? created A) Capital projects funds exist only for the duration of the project for which it is created. B) Expenditures are recorded as temporary assets until the project is completed. C) Capital projects funds use accrual accounting. D) Monies received from the general fund are recorded as revenues in the capital projects funds Which of the following statements regarding serial bonds is D) The principal repayment on an annuity serial bonds decreases each year as the false? outstanding balance decreases A) The principal on serial bonds is paid over the term of the bonds. B) The assets of a debt service fund may include Cash with Fiscal Agent. C) If the first payment is delayed for more than a year with equal payments thereafter, the bonds are deferred serial bonds. D) The principal repayment on an annuity serial bonds decreases each year as the outstanding balance decreases Which of the following is not an example of an Enterprise D) All of the above are commonly reported as enterprise funds Fund? A) Electric and Water Utilities. B) Public Libraries. C) Municipal Sports Stadiums. D) All of the above are commonly reported as enterprise funds According to GASB, enterprise funds must be used in A) When debt is backed solely by fees and charges which of the following circumstances? A) When debt is backed solely by fees and charges. B) When services are provided to other governmental units for a fee. C) When the activities are expected to make a profit to be used to fund other government programs. D) None of the above; enterprise funds are optional Capital assets of internal service funds should be reported C) in both the internal service funds and the government-wide statements A) in the internal service funds only. B) in the government-wide statements only. C) in both the internal service funds and the government- wide statements. D) None of the above, they are not reported Solid waste landfills are required to estimate the cost of D) All of the above closure which include A) cost of equipment used. B) cost of landfill cover. C) cost of caring for the site for 30 years. D) All of the above. Which of the following would generally be included in the D) No Yes Statement of Net Position of an Enterprise Fund? Reserve for Encumbrances Revenue Bonds Payable A) No No B) Yes Yes C) Yes No D) No Yes Indicate which of the following would not be an example of C) City Airport an internal service fund: A) City Self-Insurance Fund. B) City Print Shop. C) City Airport. D) City Data Processing Service Center 20/ 29 Governmental units use which fund type to account for D) Enterprise fund services provided to the general public on a user-charge basis? A) General Fund. B) Internal service fund. C) Permanent fund. D) Enterprise fund The City of Thomasville had the following debt B) $6,500,000 outstanding: General obligation bonds to be paid from a debt service fund $ 2,900,000 General obligation bonds to be paid from utility revenues $ 3,100,000 Revenue bonds to be paid from utility revenues $ 3,400,000 The amount that should be shown as debt in the utility (enterprise) fund would be: A) $9,400,000. B) $6,500,000. C) $3,400,000. D) $3,100,000 Which of the following is not true regarding proprietary D) The operation of internal service funds has no impact on other funds because it funds? is run as a business and provides services that would have been purchased else A) Enterprise funds are used by governments to account whereby the other funds for services provided to the general public on a user- charge basis. B) General obligation bonds that will be paid from enterprise revenues must be reflected in the accounts of enterprise funds. C) Internal service self-insurance should set fees based on anticipated charges or along-range plan to break even over time. D) The operation of internal service funds has no impact on other funds because it is run as a business and provides services that would have been purchased else whereby the other funds. An internal service fund provided services to a General B) expenditures Fund department. At the time of billing, the debit entry in the General Fund would be A) other Financing Sources-Transfers Out. B) expenditures. C) operating Revenues-Charges for Services. D) expenses An example of an activity that would not normally be B) Garbage collection accounted for in an internal service fund would be: A) Print shop. B) Garbage collection C) Central storeroom. D) Motor pool. Which financial statements are required for proprietary A) Statement of Net Position; Statement of Revenues, Expenses, and Changes in funds? fund Net Position; Statement of Cash Flows A) Statement of Net Position; Statement of Revenues, Expenses, and Changes in fund Net Position; Statement of Cash Flows. B) Budgetary comparison schedule; Statement of revenues, expenditures, and changes in fund balance; Statement of Net Position. C) Statement of Net Position; Statement of revenues, expenditures, and changes in fund balances; Statement of Cash Flows. D) Statement of Net Position; Statement of Revenues, Expenses, and Changes in fund net position. Which of the following is not true regarding enterprise D) The difference between assets and liabilities of enterprise funds is termed "Fund funds? Balance" A) Enterprise funds record long-term debt directly in the fund accounts. B) Enterprise funds record capital assets directly in the fund accounts. C) Enterprise funds report a Statement of Cash Flows. D) The difference between assets and liabilities of enterprise funds is termed "Fund Balance". Capital assets of an enterprise fund should be reported in D) Government-Wide Statement of Net Position and Proprietary Funds Statement of the: Net Position A) Government-Wide Statement of Net Position only. B) Proprietary Fund Statement of Net Position only. C) General Fixed Asset Account Group only. D) Government-Wide Statement of Net Position and Proprietary Funds Statement of Net Position. 21/ 29 22/ 29 Which of the following is not true regarding proprietary B) Statements required are the Balance Sheet, the Statement of Revenues, funds? Expenditures, and Changes in Fund Balances, and the Statement of Cash Flows A) Accrual accounting and the economic resource measurement focus are used. B) Statements required are the Balance Sheet, the Statement of Revenues, Expenditures, and Changes in Fund Balances, and the Statement of Cash Flows. C) Long Term debt is recorded directly in the accounts. D) Proprietary funds financial reports include the Statement of Net Position, Statement of Revenues, Expenses, and Changes in Fund Net Position, and Statement of Cash Flows. Long-term liabilities of an enterprise fund should be B) Yes Yes reported in the: Proprietary Fund Statements Government-Wide Statements A) No No B) Yes Yes C) Yes No D) No Yes According to GASB, restricted net assets are those that D) All of the above are the result of constraints from A) Imposed by law though constitutional provisions. B) Imposed by enabling legislation. C) Imposed by creditors or grantors. D) All of the above Internal service funds account for: A) Activities that produce goods or services to be provided to other governmental A) Activities that produce goods or services to be provided units on a cost reimbursement basis to other governmental units on a cost reimbursement basis. B) Activities that produce goods or services to be provided to outside consumers units on a cost reimbursement basis. C) Both of the above D) None of the above GASB requires the method to report cash flows B) direct from operating activities in the Statement of Cash Flows A) indirect. B) direct. C) modified accrual. D) full accrual If a government decides to account for its risk D) Either the General Fund or an Internal Service fund. management activities in a single fund, it must use A) an Internal Service Fund. B) a Fiduciary Fund. C) a Special Revenue Fund D) Either the General Fund or an Internal Service fund. Which of the following is not correct with respect to D) Proprietary funds record only current financial resources and liabilities that will be proprietary funds? settled with current financial resources A) Proprietary funds are used to account for activities similar to those often engaged in by commercial businesses. B) Users of goods or services are charged amounts at least sufficient to cover the costs of providing the goods or services. Thus, in the pure case, proprietary funds are self- supporting. C) Budgets may be prepared for proprietary funds to facilitate management of fund activities, but GASB standards do not require budget-actual reporting. D) Proprietary funds record only current financial resources and liabilities that will be settled with current financial resources 23/ 29 The two types of proprietary funds include B) Enterprise funds and internal service funds A) Enterprise funds and capital projects funds. B) Enterprise funds and internal service funds. C) Internal service funds and capital project funds. D) Agency funds and enterprise funds Revenue bonds: B) are intended to be paid from the revenues of an enterprise A) carry less risk than general obligation bonds. B) are intended to be paid from the revenues of an enterprise. C) are no longer in existence. D) are backed by the full faith and credit of the government in addition to enterprise revenues For landfills accounted for as enterprise funds, a portion of B) Units-of production method the estimated cost of closure of solid waste landfills should be charged as an expense and a liability of the landfill operation each year on a: A) Actual cost method. B) Units-of-production method. C) Estimated cost method. D) None of the above Which of the following statements is true regarding A) A portion of those future estimated costs is to be charged as an expense and a estimated closure costs for municipal solid waste landfills, liability recorded based on a units-of-production method. assuming that it is operating as an enterprise fund? A) A portion of those future estimated costs is to be charged as an expense and a liability recorded based on a units-of-production method. B) Modified accrual principles apply and the amount expensed is limited to amounts expected to be paid during the year and within 60 days of year end. C) The estimated closure costs are expensed fully at the time of the estimate. D) None of the above is true Impact fees imposed on commercial developers by an A) capital contributions to the enterprise fund enterprise fund and not associated with specific projects or improvements are recorded as A) capital contributions to the enterprise fund. B) operating revenues to the enterprise fund. C) unearned revenue to the enterprise fund. D) transfers from the enterprise fund to a capital projects fund When preparing the Statement of Cash Flows for the A) Receipts from customers. Proprietary Funds, cash flows from noncapital financing activities include all of the following EXCEPT: A) Receipts from customers. B) Proceeds and repayment of debt not clearly related to capital outlay. C) Grants received from and paid to other governments for noncapital purposes. D) Transfers to and from other funds Which of the following projects would normally be A) The construction of a police station addition accounted for in a capital projects fund? A) The construction of a police station addition. B) The construction of a parking garage operated as an enterprise fund. C) Payment of interest on bonds issued to finance the construction of a new city hall. D) Both the construction of a police station addition; and the construction of a parking garage operated as an enterprise fund would be accounted for in a capital projects fund 24/ 29 Cash provided by the General Fund for a capital project D) Other Financing Source - Transfer In would be recorded in a capital projects fund as a (an): A) Revenue. B) Other Financing Use. C) Direct addition to Fund Balance. D) Other Financing Source - Transfer In The following description provides the best definition for B) Special Revenue which fund: Accounts for resources that are legally restricted and both earnings and principal may be used to support government programs A) Capital projects. B) Special Revenue. C) General Fund. D) Permanent Debt service funds use the same measurement focus and B) Special revenue funds. basis of accounting as: A) Internal service funds. B) Special revenue funds. C) Internal service funds; and Special revenue funds. D) None of the choices Which of the following is true regarding capital projects A) Capital projects funds are considered to be governmental funds 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) Encumbrance accounting is not used. D) Fixed assets are depreciated in capital projects funds With respect to Permanent Funds, which of the following is C) Permanent Funds are fiduciary funds and not reported in the government-wide not true? statements A) The principal is classified as Nonspendable Fund balance. B) Permanent Funds are included in the government-wide statements. C) Permanent Funds are fiduciary funds and not reported in the government-wide statements. D) Permanent Funds use the current financial resources measurement focus. Regarding Capital Projects Funds, which of the following is C) Taxes or other revenues raised specifically for a capital project are recorded as incorrect? transfers in in the capital projects fund A) Expenditures of capital projects funds are reported in the capital outlay character classification in the Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances. B) Capital outlay expenditures result in additions to the governmental fixed assets reported in the government- wide Statement of Net Position. C) Taxes or other revenues raised specifically for a capital project are recorded as transfers in in the capital projects fund. D) Grants, entitlements, or shared revenues received by a capital projects fund from another governmental unit are considered revenues of the capital projects fund, as is interest earned on temporary investments of the capital projects fund. 25/ 29 On April 1, 2017, the City of Southern Ponds issued A) A $4,040,000 other financing source in the capital projects fund, a $40,000 other $4,000,000 in 4% general obligation, tax supported bonds financing use in the capital projects fund, and a $40,000 other financing source in a101 for the purpose of constructing a new police station. the debt service fund. The premium was transferred to a debt service fund. A total of $3,990,000 was used to construct the police station, which was completed before December 31, 2017, the end of the fiscal year. The remaining funds were transferred to the debt service fund. The bonds were dated April 1, 2017, and paid interest on October 1 and April 1. The first of 20 equal annual principal payments of$200,000 is due April 1, 2018 In addition to reporting Bonds Payable and ( unamortized) Bond Premium in the government-wide Statement of Net Position, how would the bond sale be reported? A) A $4,040,000 other financing source in the capital projects fund, a $40,000 other financing use in the capital projects fund, and a $40,000 other financing source in the debt service fund. B) As a $4,000,000 liability in the government-wide Statement of Net Position and as a $4,000,000 other financing source in the debt service fund. C) As a $4,040,000 liability in the government wide Statement of Net Position, as a liability of $ 4,040,000 in the capital projects fund, and as an other financing source of $4,040,000 in the capital projects fund. D) The $4,000,000 liability in the government wide Statement of Net Position and the$40,000 would also be recorded as a bond premium in the Statement of Net Position A non-expendable trust which benefits a government or its A) Permanent Fund citizenry and which stipulates that earnings only (not principal) may be used for its provided purpose should be reported in a: A) Permanent Fund. B) Special Revenue Fund. C) Private-purpose Trust Fund. D) None of the choices Which of the following is a source of funding for capital D) All of the choices projects funds? A) Gifts from individuals and corporations. B) Proceeds from issuance of Long-term debt. C) Grants. D) All of the choices. Which of the following funds typically record budgets? D) General Funds and special revenue funds A) General Funds, special revenue funds, capital projects, debt service, and permanent. B) Only General Funds. C) General Funds and permanent funds. D) General Funds and special revenue funds Siler City receives a trust donation for the purpose of B) Special Revenue Fund maintaining flower beds in city parks, but the donor does not specify that the principal must be maintained. This type of trust would be most appropriately accounted for in a: A) Private Purpose Trust Fund. B) Special Revenue Fund. C) Permanent Fund. D) General Fund 26/ 29 Which of the following is/are true regarding Capital D) All of the choices are true Projects Funds? A) A major source of funding for capital projects funds is the issuance of long-term debt. B) Capital project funds only exist for the duration of the project for which it is created. C) Capital Project funds use the Modified Accrual Basis of Accounting. D) All of the choices are true Which of the following is not correct with respect to the C) The general fund may be combined with funds that are insignificant in amount for General Fund? presentation purposes. A) There can only be one general fund. B) Only the general fund has a positive unassigned fund balance. C) The general fund may be combined with funds that are insignificant in amount for presentation purposes. D) The general fund has an indefinite life The city is using an internal service fund to self-insure its C) Operating Expenses risk financing activities. Claims accrued or paid by this fund are recorded as: A) Transfers out. B) Special Items. C) Operating Expenses. D) Nonoperating Expenses The Water Utility (an enterprise fund) has just sent out a D) None of the above purchase order to a vendor for some new equipment. Which of the following would be included in the journal entry to record this event? A) A credit to Accounts Payable. B) A debit to Encumbrances. C) A debit to Expenditures. D) None of the above Which of the following is true regarding internal service D) Internal service funds use accrual accounting and the economic resources funds? measurement focus A) Internal service funds provide services primarily to external users on a user chargebasis. B) Internal service funds normally record the annual budget in the accounts. C) Internal service funds' capital assets are not accounted for in the accounts. D) Internal service funds use accrual accounting and the economic resources measurement focus Which of the following funds use accrual accounting? A) Internal Service Fund. A) Internal Service Fund. B) Special Revenue Fund. C) Permanent Fund. D) Both of the above. Which financial statements are required for a proprietary C) Statement of Revenues, Expenses and Changes in Fund Net Position, fund? Statement of Net Position and Statement of Cash Flows A) Statement of Revenues, Expenses and Changes in Fund Net Position and Statement of Net Position. B) Income statement, Statement of Net Position and Statement of Cash Flows. C) Statement of Revenues, Expenses and Changes in Fund Net Position, Statement of Net Position and Statement of Cash Flows. D) Statement of Revenues, Expenses and Changes in Fund Balance and Statement of Net Position, and Statement of Cash Flows 27/ 29 This fund accounts for activities that produce goods or B