1. The city of Romeo purchased a squad car for the police department. If the operations of the police department are financed by general revenues, which of the following is correct concerning where the purchase of the car would be recorded? A. General Fund: No; Governmental Activities: Yes B. General Fund: No; Governmental Activities: No C. General Fund: Yes; Governmental Activities: No D. General Fund: Yes; Governmental Activities: Yes 2. In late June, the Everready Construction Co. submitted a $600,000 progress billing on a construction contract. On July 2, the bill was approved for payment, subject to a five percent retention, as provided by the contract. Construction expenditures should be debited when A. The bill is approved for payment. B. The bill is received. C. The bill is paid (except for the five percent retention). D. The final five percent of the bill is paid. 3. In 2011, Weaver City signed a contract in the amount of $6,000,000 for the construction of a new city hall. Expenditures were $4,000,000 in 2011 and $2,050,000 in 2012, which included a change to the original construction design in the amount of $50,000. What amount should be added to net capital assets in the governmental activities accounts in 2012? A. $6,000,000 B. $6,050,000 C. $2,050,000 D. $2,000,000. 4. The sale of revenue bonds by a water utility fund would be recorded A. In the governmental activities accounts as a liability. B. In an enterprise fund as "Proceeds of Bonds." C. In an enterprise fund as a liability. D. In an enterprise fund as a revenue. 5. The city of Superior's fiscal year ends on December 31. On July 1, 2011 Superior issues $1,000,000 of 8%, 10-year term bonds with semi-annual interest payments due on July 1 and January 1 each year. The General Fund transferred $100,000 to the debt service fund on July 1, 2011 to pay for interest to bondholders for the year. The debt service fund invests the money at an annual rate of 10%. What is the amount of total assets in the debt service fund at the end of 2011? A. $65,000 B. $105,000 C. $965,000 D. $1,005,000 6. The city of Sparr's fiscal year ends on December 31. On July 1, 2011, the city issued $1,000,000 of 6%, 10-year term bonds with semi-annual interest payments due on July 1 and January 1 each year, beginning on January 1, 2012. What amount of expenditures should the city recognize in its debt service fund for the years 2011 and 2012? A. $30,000 in 2011; $60,000 in 2012. B. $60,000 in 2011; $60,000 in 2012. C. $3,000 in 2011; $6,000 in 2012. D. $0 in 2011; $60,000 in 2012. 7. Ingham County collects, in addition to its own taxes, taxes for other units. Tax levied for 2011 were as follows: Collections from the 2011 levies amounted to $3,550,000 and were distributed in proportion to the original levies, less a 1% collection fee charged Mason City and the Mason School District. Collection fees are remitted to the Ingham County General Fund. Required 1) Record the tax levies in the Ingham County Tax Agency Fund. 2) Record the collection from the 2011 tax levies in the Ingham County Tax Agency Fund and the specific liabilities owed each fund and unit (Round all amounts to the nearest whole dollar.) 3) Record in the Ingham County Tax Agency Fund the transfer of collected taxes to each fund and unit