ACCT 351
ACCT 351 Exam 2 With Correct Detailed
Answers 2025-2026
Modified Basis of Accounting -Correct Answers ✔-Has to be measurable and
available
Accrual Basis of Accounting -Correct Answers ✔-recognizes revenues when they
are earned
Current -Correct Answers ✔--Looking for balance
-Cash or assets that will be converted to cash -within 90 days
-Over a year not reported current
-Report if using current resources
Economic -Correct Answers ✔-Reporting long and short term
Interfund Transactions -Correct Answers ✔-Transactions between individual funds
Eliminated in government wide statements
Reciprocal Interfund Transactions -Correct Answers ✔-Internal counterpart-
exchange-like transaction
1. Interfund Loans
- Resources provided with understanding that they will be paid back in the future
ACCT 351
, ACCT 351
-Recorded as if Transactions were "in-house"
2. Interfund services provided and used
- Transactions involving sales and purchases of goods and services between funds
-Recorded as if transactions were completed with party outside the government
Nonreciprocal Interfund transactions -Correct Answers ✔-1. Interfund Transfer
-Transactions that are cash or other assets without requirement of repayment
-Classifies as other financing sources or uses
Recognition of inventories in Governmental Funds -Correct Answers ✔-
Consumption Method
-Used by Commercial Bussiness
-Supplies inventory debited when inventories acquired
-When used or consumed Expense account debted
Purchase Method
-Expenditures debited when supplies are received
-Year-End supplies inventory and non-spendable fund balance are adjusted to
reflect amount of unused supplies on hand
Governmental Funds -Correct Answers ✔-General
Debt Service
Capital Projects
Special Revenue
ACCT 351
ACCT 351 Exam 2 With Correct Detailed
Answers 2025-2026
Modified Basis of Accounting -Correct Answers ✔-Has to be measurable and
available
Accrual Basis of Accounting -Correct Answers ✔-recognizes revenues when they
are earned
Current -Correct Answers ✔--Looking for balance
-Cash or assets that will be converted to cash -within 90 days
-Over a year not reported current
-Report if using current resources
Economic -Correct Answers ✔-Reporting long and short term
Interfund Transactions -Correct Answers ✔-Transactions between individual funds
Eliminated in government wide statements
Reciprocal Interfund Transactions -Correct Answers ✔-Internal counterpart-
exchange-like transaction
1. Interfund Loans
- Resources provided with understanding that they will be paid back in the future
ACCT 351
, ACCT 351
-Recorded as if Transactions were "in-house"
2. Interfund services provided and used
- Transactions involving sales and purchases of goods and services between funds
-Recorded as if transactions were completed with party outside the government
Nonreciprocal Interfund transactions -Correct Answers ✔-1. Interfund Transfer
-Transactions that are cash or other assets without requirement of repayment
-Classifies as other financing sources or uses
Recognition of inventories in Governmental Funds -Correct Answers ✔-
Consumption Method
-Used by Commercial Bussiness
-Supplies inventory debited when inventories acquired
-When used or consumed Expense account debted
Purchase Method
-Expenditures debited when supplies are received
-Year-End supplies inventory and non-spendable fund balance are adjusted to
reflect amount of unused supplies on hand
Governmental Funds -Correct Answers ✔-General
Debt Service
Capital Projects
Special Revenue
ACCT 351
