1. During Year 5 the city of Bellaire received a $120,000 grant from the state for a special meals for the homeless program required to be administered by the city ratably at $40,000 per year over the next three years, beginning in Year 6. How much should the city report as grant revenue for Year 5?

		A. $0
		B. $40,000
		C. $80,000
		D. $120,000

2. Which of the following statements is not true?

		A. When a taxpayer fails to pay his property taxes, the city may place a lien on the property.
		B. The outstanding encumbrances balance must always be closed at year-end.
		C. A city reports payments in lieu of taxes from other governments as revenue.
		D. An unrestricted grant is reported as revenue only to the extent of the amount spent