(Multiple choice)

1. Several years ago a city established a sinking fund to retire an issue of general obligation bonds. This year the city made a $\$ 50,000$ contribution to the sinking fund from general revenues and realized $\$ 15,000$ in revenue from securities in the sinking fund. The bonds due this year were retired. These transactions require accounting recognition in which of the following funds?

a. General Fund

b. Debt Service Fund

c. Debt Service Fund and General Fund

d. Capital Projects Fund, Debt Service Fund, and General Fund

e. None of the above 2. To provide for the retirement of general obligation bonds, a city invests a portion of its general revenue receipts in marketable securities. This investment activity should be accounted for in which of the following funds?

a. Trust Fund

b. Enterprise Fund

c. Special Assessment Fund

d. Special Revenue Fund

e. None of the above (AICPA adapted)
3. In preparing the General Fund budget of Brockton City for the forthcoming fiscal year, the city council appropriated a sum greater than expected revenues. What will be the result of the council's action?

a. A cash overdraft during the fiscal year

b. An increase in encumbrances by the end of the fiscal year

c. A debit to Budgetary fund balance

d. A necessity for compensatory offsetting action

e. None of the above (AICPA adapted)
4. Which of the following funds is used to account for the operations of a public library receiving the majority of its support from property taxes levied for that purpose?

a. General Fund

b. Special Revenue Fund

c. Enterprise Fund

d. Internal Service Fund

e. None of the above (AICPA adapted)
5. A special tax was levied by Downtown City to retire and pay interest on general obligation bonds that were issued to finance the construction of a new city hall. Where are the receipts from the tax recorded?

a. Capital Projects Fund

b. Special Revenue Fund

c. Debt Service Fund

d. General Fund

e. None of the above 6. Which of the following funds uses modified accrual accounting?

a. All governmental-type funds

b. General Fund and Special Revenue Funds only

c. Only the General Fund

d. Only Debt Service Funds

e. None of the above 7. To what does the term current financial resources measurement focus refer?

a. The use of the modified accrual basis of accounting

b. The measurement of resources available for spending

c. The use of the full accrual basis of accounting

d. The timing of the recognition of revenues and expenditures

e. None of the above