1. Whenever a tax or other revenue source is authorized by a legislative body to be used for a specified purpose only, a special revenue fund should be established. True False

2. Fund equity of the general fund at the end of the fiscal year is defined as the difference between its assets and its liabilities. True False

3.Interfund transfers and debt issue proceeds received by the general fund would be recorded as other financing sources.

True False

4.All purchases of goods and services by a general fund and all inter-fund transfers are recorded as expenditures.

True False

5. All decreases in fund financial resources, other than for repayment of fund liabilities, are termed "expenditures."

True False

6.Budgetary accounts used in the general fund include estimated revenues, revenues, appropriations, encumbrances, and expenditures.

True False

7. An encumbrance represents the estimated liability for goods placed on order.

True False

8. General funds and special revenue funds are entitled to record legally approved revenue budgets as receivables and legally approved appropriations as payables.

True False

9.In recording a legally approved budget, a budgeted excess of estimated revenues over appropriations should be credited to the fund balance account.

True False

10.Governmental units which are temporarily short of cash but which have levied taxes expected to be collectible during the fiscal year are generally able to borrow on short-term notes known as "tax anticipation notes payable." True False

11. When purchase orders or contracts are issued for legally authorized purposes a record must be kept, but no entries in the general fund or special revenue fund accounts are necessary.

True False

12.The payment of liabilities by the general fund or a special revenue fund requires the expenditure of an appropriation.

True False

13.Under the modified accrual basis of accounting applicable to governmental fund types, the revenues account is credited for the total amount of property tax bills prepared.

True False

14. If property taxes are not collected by the date specified by law, additional revenue is generally earned by the fund of the governmental unit for which the taxes were levied.

True False

15.If a governmental unit uses the encumbrance method for purchases of goods and services, generally accepted accounting principles require that it also use the encumbrance method for its payrolls.

True False