1.

The city of Steveville is preparing its annual financial statement. A new employee, Victoria Watson, is responsible for preparing the basic financial statements for the citys three Internal Service Funds. Where should Victoria report the Internal Service Fund activity in the combined financial statements?

Select one:

a. Any major Internal Service Funds should be reported in separate columns in the proprietary fund financial statements and nonmajor Internal Service Funds should be reported in a column with nonmajor Enterprise Funds.

b. Internal Service Funds should be reported in their own separate set of financial statements that shows a column for each major Internal Service Fund with the remainder of Internal Service Funds aggregated in a single column.

c. Internal Service Funds should be aggregated in a single column to the right of Enterprise Funds in the proprietary fund financial statements.

d. Internal Service Funds are not reported in the fund financial statements, but rather only reported as part of government-wide reporting.

2.

The city of Trawville has a Water Enterprise Fund that provides potable water for use by the residents and businesses of the city. The Water Enterprise Fund also provides potable water to other city departments. The Water Enterprise Fund bills the General Fund ($1,800) and the Golf Course Enterprise Fund ($1,600) for their water use during the most recent month. What journal entry should be recorded in the Water Enterprise Fund?

Select one:

a.

Due from General Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1,800
Due from Golf Course Enterprise Fund . . . . . . . . . . . . . . . . .	1,600
Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		3,400

b.

Due from General Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1,800
Due from Golf Course Enterprise Fund . . . . . . . . . . . . . . . . . .	1,600
Expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		3,400

c.

Due from General Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1,800
Due from Golf Course Enterprise Fund . . . . . . . . . . . . . . . . . . . .	1,600
Transfer in from General Fund . . . . . . . . . . . . . . . . . . . . . . . .		1,800
Transfer in from Golf Course Enterprise Fund . . . . . . . . . . .		1,600

d.

Expenditures. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3,400
Due to General Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		1,800
Due to Golf Course Enterprise Fund. . . . . . . . . . . . . . . . . .		1,600

3.

The city of Grigsbys Water Enterprise Fund enters into a lease agreement with Nguyen Leasing Company for new computer hardware. The present value of lease payments over the life of the four-year lease is $48,000. What journal entry would Grigsby accounting personnel make in the Water Enterprise Fund at the inception of the lease?

Select one:

a.

computer expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	48,000
Lease payable. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		48,000

b.

Intangible assetlease . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	48,000
Lease payable. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		48,000

c.

Expenditurescapital outlay . . . . . . . . . . . . . . . . . . . . . . . . . . . .	48,000
Other financing sourcelong-term lease . . . . . . . . . . . . . .		48,000

d.

Capital assetcomputer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	48,000
Other financing sourcelong-term lease . . . . . . . . . . . . . .		48,000

4.

Which of the following items is reported in a governments Enterprise Fund financial statements, but would not be reported in a publicly traded companys financial statements?

Select one:

a. Other comprehensive income

b. Notes payable

c. Deferred inflows of resources

d. Investments

Both Internal Service Funds and Enterprise Funds use flexible budgets to control their activities but dont incorporate these budgets into their accounts because:

Select one:

a. Both fund types have a monopoly on the services they provide.

b. Encumbrance accounting is not a good source of control.

c. Flexible budgets change based on volume and are difficult to record in the accounts.

d. Both fund types use marketplace controls instead.

5.

The city of Cool reports a Public Transportation Enterprise Fund. In its statement of net position as of December 31, 2018, the Fund reports, among other things, cash, and investments, depreciable capital assets and nondepreciable capital assets. Based on the information provided, which components of net position should the Enterprise Fund report?

Select one:

a. Net investment in capital assets and unrestricted

b. Restricted, unrestricted, and net investment in capital assets

c. Nonspendable and committed

d. Net investment in capital assets and assigned