GOV/NON PROFIT ACCOUNTING: TEST 1 MULTIPLE CHOICE QUESTIONS | QUIZ SMART | SCORE HIGH | GUARANTEED ACCURACY!

GOV/NON PROFIT ACCOUNTING: TEST 1 MULTIPLE
CHOICE QUESTIONS | QUIZ SMART | SCORE HIGH |
GUARANTEED ACCURACY!
Which of the following is a special purpose government?
a) The State of Arkansas
b) Greene County
c) Minneapolis Public Schools
d) City of Seattle - Answer: c) Minneapolis Public Schools


Which of the following statements is true for both governmental organizations and for-
profit organizations?
a) Lack of a profit motive
b) Revenue may be earned through exchange transactions
c) Absence of owners
d) Resources are provided by individuals and entities that may not directly benefit from
the use of the resources - Answer: b) Revenue may be earned through exchange
transactions


Which of the following statements regarding primary sources of accounting and financial
reporting standards is false?
a) The GASB sets standards for all state and local governments.
b) The FASB set standards for all business and not-for-profit entities
c) The FASB and GASB are administered by the Financial Accounting Foundation.
d) The FASAB sets standards for the federal government and its agencies and
departments. - Answer: b) The FASB set standards for all business and not-for-profit
entities


James Black is reviewing his city's financial reporting because he wants to run for the
city council. He is concerned that the city is not using its resources effectively. James is
primarily interested in:

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,a) Fiscal accountability
b) Social accountability
c) Political accountability
d) Operational accountability - Answer: d) Operational accountability


The concept of interperiod equity refers to whether
a) Revenues equaled or exceeded expenses for the year.
b) Total assets (current and noncurrent) were sufficient to cover total liabilities (current
and noncurrent).
c) Current year revenues were sufficient to pay for current year services
d) Future taxpayers can expect to receive the same or higher level of services as
current taxpayers. - Answer: c) Current year revenues were sufficient to pay for current
year services


What are the components that are included in the minimum requirements for general
purpose external financial reporting?
a) Introductory section, financial section, and statistical section.
b) MD&A, government-wide financial statements, fund financial statements, notes to the
financial statements, and RSI
c) Letter from the chief financial officer, government financial statements, notes to the
financial statements, and RSI.
d) MD&A, government-wide financial statements, notes to the financial statements, and
RSI. - Answer: b) MD&A, government-wide financial statements, fund financial
statements, notes to the financial statements, and RSI


Which of the following is not a required section of a federal agency or department's
performance and accountability report (PAR)?
a) A performance section, which includes an annual performance report (APR).
b) An MD&A
c) A basic financial statements section.



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,d) A statement of nonparticipation in political matters - Answer: d) A statement of
nonparticipation in political matters


The basic financial statements of a not-for-profit include all of the following except
a) Statement of financial position
b) Statement of Activities
c) Statement of changes in functional expenses
d) Statement of cash flows - Answer: c) Statement of changes in functional expenses


The primary reason that not-for-profit (NFP) organizations should report expenses
incurred for program purposes separately from those for supporting services such as
management and general and fund-raising is that
a) GASB standards require it.
b) Program managers need information about the cost of activities for which they are
responsible.
c) Top managers need to know how much they are spending for nonprogrammatic
management and general support.
d) Donors, potential donors, oversight bodies, and other need to know what percentage
of total expenses are being incurred for carrying out the NFP's programs - Answer: d)
Donors, potential donors, oversight bodies, and other need to know what percentage of
total expenses are being incurred for carrying out the NFP's programs


Special purpose governments generally provide a wider range of services to their
residents than do general purpose governments.
- True
- False - Answer: - False


The Financial Accounting Standards Board (FASB) is the body authorized to establish
accounting principles for all colleges and universities and health care entities.
- True
- False - Answer: - False

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, The Governmental Accounting Standards Board (GASB) is the body authorized to
establish accounting principles for all state and local governments, both general
purpose and special purpose.
- True
- False - Answer: - True


A characteristic common to governments and not-for-profit organizations is that they do
not exist to provide goods or services at a profit or profit equivalent.
- True
- False - Answer: - True


The FASB, GASB, and FASAB all focus their standards on both internal and external
financial reporting.
- True
- False - Answer: - False


Interperiod equity refers to the concept that current-year revenues are sufficient to pay
for services provided that year, so that future taxpayers will not be required to assume
the burden for services previously provided.
- True
- False - Answer: - True


The GASB provides optional guidance for those entities providing service efforts and
accomplishments (SEA) reports to the public.
- True
- False - Answer: - True


The Governmental Accounting Standards Board is assigned responsibility for setting
accounting and financial reporting standards for



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